The festive mood in markets is likely to continue this week on the back of positive global cues and stock-specific activities, particularly in shares of auto and cement companies which will come out with their monthly sales figures.
Last week benchmark indices Nifty and Sensex closed on a positive note, higher by more than 6% on a week on week basis. The rally was led by sectors like metals and realty which gained more than 9% and 8%, respectively.
Though the rally in the mid-cap and small-cap indexes was not much, they settled with gains of more than 2%.
"Around three months back when bear trend started, it has created a big negative gap which acted as a strong resistance zone. This time it has created a big positive gap at the same level. Overall we can also call it a small island bottom," Wellindia Group Senior Manger (Research) Vivek Negi said.
Angel Broking in a research report said Samvat 2068 --the Hindu new year -- has began in favour of the bulls and "finally, after several attempts, the bulls have managed to cross a firm resistance level of 17,260/5,198 and closed convincingly above it.
Going forward, it is likely that indices are now heading towards the 18,020/5,410 level, the report added.
Market experts said at present the global cues are positive as Europe saw a way-out to its problem, the US also delivered good GDP numbers (2.5%).
On the domestic front, worst is not over, but it has already been "discounted" in the prices, they added.
Negi said 4,800-5,200 zones would act as long-term support level for the markets. Besides, the market is showing signals of strength. "We expect markets to touch 5,540 in next couple of weeks," he added.
The week will see stock-specific activity as the second quarter earnings season gathers momentum. Besides, automobile and cement stocks will be the focus as the companies would unveil their sales volume data for October.
Shares of car major Maruti Suzuki, which posted a 59.81% fall in net profit to Rs 240.44 crore for the second quarter net profit, will react to the numbers on Monday.
The week will also see earnings announcement by ICICI Bank, Wipro, NMDC, BPCL, Punjab National Bank, Aditya Birla Nuvo, Sun TV Network, Ashok Leyland, ONGC, Bharti Airtel and GlaxoSmithKline.