The Indian markets ended the previous week with sharp price cuts, as developments at Yes Bank and global volatility impacted the traders' sentiments. Financials were the worst impacted sector, besides media. Pharma and IT emerged as safe haven as INR-USD depreciated materially. Auto and consumption also held well amidst the route. The market breadth was very poor; the level of activity way above average and volatility was also higher. FPIS remained significant sellers, while domestic institutions bought whatever they had to sell. Bonds continued to gain strength as slowdown persists.

The global markets turned extremely nervous and volatile as the experts' differed in their opinion over the impact of the COVID-19. Fed initiated the process of damage control by cutting a strong 50bps. US and Chinese equities ended the week with good gains, while European, Japanese and other Asian equities were generally down. The fissure in OPEC cartel, sent the crude prices crashing. Precious metals resumed their upward journey after a small blip a week before. Bond yields touched new lows. USD was generally weaker.

The near term market trend is now neutral with marginally negative risk-reward. The outlook for the market as of this morning is, therefore, is neutral. However, given that momentum is now very strong, a dramatic change in the market trend and outlook cannot be ruled out. As of this morning, there is no immediate trade in Nifty and Bank Nifty. However, A sharp decline in Nifty to 10600-650 range could present an aggressive buying opportunity. The shorts must hold their positions with a strict stop loss of 11327 on a closing basis. Trading in Bank Nifty may be avoided this week.