Sensex may touch 11,500 on downside in April: Experts

The markets ended with marginal gains on the last trading day of the week. Opening week, markets picked up some momentum during the noon trades, but could not sustain its position at the higher levels and ended the day with slim gains.
However, the midcap and smallcap indices outperformed the broader markets. The volumes were relatively low even in today's session. Metal stocks were star performers followed by banking and capital good stocks. Tata Steel, Reliance Energy, Grasim, Hindalco, ACC were among the gainers on the indices.
On weekly basis, the indices end in red down about 2% mainly due to the carnage on Monday.
Sensex closed up 69.31 points or 0.54% to end the day at 12856.08, while the Nifty up 18.75 points or 0.50% at 3752. The BSE Midcap Index ended at 5,319.95 up 39.88 points or 0.76%. The BSE Smallcap Index ended at 6,456.37 up 70 points or 1.1%.

About 1623 shares advanced, 840 shares declined, and 67 shares are unchanged.
Dilip Bhat of Prabhudas Liladher feels that people are keenly anticipating the pronouncements for 2007-08. According to him, people are not in a hurry to build their position, which will probably pan out over the next one-and-a-half to two months, till results start flowing in and companies start giving guidance - at that time, everyone would probe the management about the impact of the particular measures that they have taken.
"So I think in the coming few weeks perhaps the best policy would be to wait and possibly if you are really a long-term investor then if the markets come off then one can probably buy on a selective basis," he sums up.

Bhat is confident that Q4 will clearly be a good quarter. For the month of April, he expects anywhere between the 11,500-12,000 range on the downward side, while on the upside, he sees about 12,700-12,800.

Investment advisor PN Vijay is relieved to see some confidence and composure returning to a truncated week. “The advance decline ratios have been very encouraging for the last three days; yesterday it was 3:1, today it is almost 5:1, which means there is broad participation, I am not too worried about the lack of volumes because that volume is noise volume of intra-day traders. To round it all almost all the sectors are participating, like banking, metal, real estate, cement, all joining the party. So it’s a good day for the market,” he says.

As far expectations from the earnings go, he feels that it is difficult to make a call, as the global forces as well as domestic inflation have presently hit the market. Bhat says, “Generally people are expecting this quarter earnings to be extremely good even for beaten down sectors like cement, except for banking, which will get it on the back side. Even autos will have good earnings for this quarter.".

In case of bad results, markets would plummet, but if there are decent results, he expects people to check if inflation and interest rates are coming down, which is when the bull market will start reassuring itself.