Short covering ahead of F&O expiry today : Indian Markets expected to be in range bound with no breakup either side.

Equities in Indian ended higher but off day’s highs on Wednesday as funds covered short positions ahead of September F&O series expiry.

Indices opened firm tracking positive Asian markets after Warren Buffet’s Berkshire Hathaway announced plans to invest $5 bn in Goldman Sachs.

With only a day to go for the expiry of the September series, the Nifty is stuck in a narrow band of 4,000-4,250, indicating that futures and options (F&O) players are waiting for the expiry of derivatives.

National Stock Exchange’s Nifty was at 4161.25, up 34.35 points or 0.83 per cent. It touched an intra-day high of 4,207.95 and low of 4,115.85.

Trading has been extended by both the bourses till 4:15 pm to adjust for suspension between 11:25 am to 12:10 pm due to sun outage.

Asian emerging markets ended in the green on Wednesday after Berkshire Hathaway promoter Warren Buffet announced an investment of $5 billion in the Goldman Sachs Group, sending a positive signal to global equity markets. The S&P CNX Nifty opened on a positive note, by met with selling pressure above the resistance level and closed the day with a modest gain.

In the US, stock futures were pointing to a positive start following Warren Buffet’s investment plan. But concerns still remain over infusion of tax-payers $700 bon by the Federal Reserve into the US financial system. Market players are worried that the bail-out package may not be able to pull-out the US economy from doldrums.
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HBJ Capital's Strategy:-
>>>>>It is better to wait for the congress to clear the bailout package of $700bn. We will analyze its form and based on the impact take a call to go long or short. It would good to react to that news rather than taking any position now.

>>>>>Partial short covering already happened on Wed; hence we are not expecting market to move either side more than 1% up/down. So, in this situation keeping off the market is better until bailout package get approved by weekend.
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- HBJ Capital Team