Weekly Snap Shot- Sensex gained 7.6%, the Nifty closed 7.22% higher

After bouncing back from the lows of 4639 late last week, the week gone by saw the markets rallying strongly to end the week with hefty gains. While the Sensex gained 7.6%, the Nifty closed 7.22% higher. Market breadth was however positive in only two out of the five trading sessions of the week.

Key Events

Global Markets

The number of people filing for initial unemployment benefits in the USA rose by 6,000 to 402,000 in the latest week, the government said. That was higher than expected, with economists forecasting jobless claims to have totaled 390,000 for the week ending Nov. 26.

Standard and Poor's cut the ratings on dozens of major banks, including Bank of America, Goldman Sachs, and Citigroup. The downgrades were the result of the agency's new ratings criteria for the world's 37 largest financial institutions.

Worries about Europe's debt crisis continued to dominate the week amid a series of lackluster debt auctions and rising eurozone bond yields. Mounting yields continued to trouble investors on Friday. Italian 10-year bond yields moved back above 7%, a level that eventually required bailouts for Greece, Portugal and Ireland. The Spanish 10-year yield also rose to within spitting distance of the worrisome level.

Indian Markets

Government indicated that no proposal for any kind of bailout package for loss making private airlines was under its consideration.

India's October exports rose an annual at Rs 1,01,920 crore ($19.6 billion). Oil imports for the month grew 21.7% to Rs 1,03,480 crore ($19.9 billion), while imports for the month rose 21.7% to Rs 2,05,400 crore ($39.5 billion)

Terming the 6.9% economic growth in the second quarter as "lower than expectation", the Prime Minister's Economic Advisory Council indicates that good performance by farm sector would take annual growth for FY12 to 7.5%

Key Sectoral Movement

All the sectoral indices ended with gains for the week ended December 02, 2011. The top sectoral gainers were BSE Metal, Bankex, Oil and Gas and Power indices.

Outlook of the week

With the markets rebounding strongly and the Nifty crossing the 5011 resistances, the bulls do seem to have an upper hand. Traders will need to see if the Nifty can cross the 5169 resistances for further upsides. Crucial downside supports are at 4920.

Source-hdfcsec