Sensex, Nifty to open on a weak note

Crude oil fell 6% but Dow and S&P managed to break a three-day losing streak recovering from last week's brutal rout. On the other hand, the Nasdaq closed modestly lower, falling for the eighth consecutive session.

The Nifty’s inability to conquer previous peak of 7979 led to a sharp reversal with the sliding index now on the verge of violating previous support of 7540. Investors are feeling uneasy with the sinking feeling. With uncertainty and chaos in global markets, a fall below 7540 on closing basis would result in a breakdown from a descending triangle pattern on the long term charts. For index to reverse current predicament, pullback from lows has to sustain above 7750 for consecutive days. If global cues support later in the day, it could well happen.

The opening is set to be weak at start. Results will be in focus as TCS announces its numbers. TCS has already published that disruption at its Chennai facility (one of its largest delivery locations with over 65,000 employees) is likely to have a material impact on revenues of the quarter. The third quarter of a fiscal year has traditionally been a weak period for India IT companies characterized by lesser number of working days and furloughs at the client’s end.

Crude oil fell 6% but Dow and S&P managed to break a three-day losing streak recovering from last week's brutal rout. On the other hand, the Nasdaq closed modestly lower, falling for the eighth consecutive session.

Moody's Investors Service expects India (Baa3 positive) to remain among the world's fastest growing major economies in 2016, but believes market trends this year will depend on whether inflation remains under control and corporate profits revive.