Sensex, Nifty break crucial supports levels

Equities were under tremendous pressure as investors squared off positions at any available price on growing concerns over health of globa
l economy. Benchmarks broke crucial support levels after heavy selling emerged in heavy-weight stocks like Reliance Industries, Infosys Technologies and ICICI Bank.

Nifty futures witnessed an increase in OI by 1.76 per cent along with a marginal increase in Nifty futures price by 0.19 per cent. The PCR-OI increased marginally from 0.79 to 0.8. The options data shows 14300 contracts addition in 3700 Call. Also, 3600 Call added 9001 contracts. Hence, markets may find difficult to close above the 3600 mark on a closing basis. FIIs have been net sellers to the tune of Rs 680.42 crore in the cash segment, whereas DIIs have bought Rs 548.29 crore. The immediate supports for the Nifty are at 3540, 3478 and resistances are at 3690 and 3730.

“India is one of the two markets where we have a consensus underweight recommendation. Even though the market has underperformed Asia the most year-to-date, it is still trading at an 88% premium to the region on P/BV and 34% on P/E,” said Confederation of Indian Industries.

Meanwhile, CLSA has forecast end-FY10 Sensex target at 9,500.