The Sensex recovered in the last hour of trade and ended with modest losses. Today's recovery was mainly led by heavyweights like Bharti Airtel, Tata Motors and DLF. The Sensex fell 54 points to close at 15,020 after hitting an intraday low of 14,701 and covered more then 2% from the intraday lows. The Nifty lost 14 points to 4,457 after hitting an intra-day low of 4,359. However, selling continued in shares of metal, technology, oil & gas exploration, select banking and power companies.

The economic data announced by the government was much better-than estimates. June IIP (index of industrial production) came in at 7.8% as against 5.4% year on year and 2.7% month on month.

The trend still remains cautious has huge selling pressure is witnessed at higher levels. Today markets witnessed a Ushaped recovery in the last hour of trade which was mainly due to short-covering which helped the nifty to maintain and close above the 4400 mark. Going forward its very important that nifty maintains above 4510-4550 for a fresh development to happen.

The markets are under huge pressure due to poor monsoon which could worsen the macro fundamentals and would result in GDP estimates being downgraded in the future. The short-tern trend is very weak as there are no fresh triggers to lift the market sentiments. Today's rally could be short lived as huge selling at higher levels could not be ruled out in coming days. Strong resistance for Nifty continues to be in the region of 4550-4600, unless we see a strong closing above these levels every rise is a selling opportunity.

STOCK IDEA:

1) JPASSOCIATE (214) - Buy from a trading angle with a stop-loss of 208 for a short term target of 226-237.
2) IVRCL (308) - Buy and hold with a stop 294 for short term target of 331-350.
3) SUZLON (86) - The stock is heavily oversold, buy with a stop-loss of 83 for a target of 91-97

Nifty future daily chart: The trend still remains cautious but today we have witnessed huge short covering and going forward we may see more unwinding. From a trading perspective one can buy nifty future with a strict stop-loss of 4410 which is the 50-day moving average for a target of 4550-4580. Unless we see a strong closing above 4600 every rise should be used as a selling opportunity.