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The bulls broke their shackles in late afternoon trade today, energised by news that the Indo-US nuclear deal may indeed see the light of day. This, after the Left said it would allow the government to discuss the deal with the IAEA, a move it had been opposing for so long.

The Nifty closed 78 points higher, at 5,695, and the Sensex shut shop 298 points higher, at 19,035.

The bulls staged a strong comeback, which helped markets close with hefty gains. The day started flat, with buying seen in midcaps and smallcaps, but moved ahead with heavy buying seen in frontline banking, power and capital good stocks. The Sensex was up 350 points and the Nifty scored almost a century ending near the 5,700 mark.

On the macroeconomic front, the Left has given the nod to the government to proceed negotiations with IAEA on the nuke deal and that acted as a positive trigger. Amitabh Chakraborty of Religare Securities said that the markets are expected to be volatile in November. He added that liquidity in the system will be quite low.

“Our call for November is that the market would be very volatile, post P-Note issue. Unless those people become FIIs, they cannot buy. So, if there is a seller in the market, no one is there to buy the stock. So, the impact cost for any selling effort will be very high. The market will become very volatile and the liquidity in the system will be quite low. Having said that, the trend is very positive and we believe that we will be seeing 6,200 on the Nifty by early December. We have to accept intra-day 600-700 points volatility,” said Chakraborty.

“I am not very worried about the political situation at this point of time. The fundamentals of India are strong enough. That gives a fillip and that is why we have seen that post the news flash, there has been some movement. But actually, we are very confident in Religare that 6,200 levels will be seen by the first week of December,” he added.

Rajat Bose of rajatkbose.com said that he is not bothered by volatility or a 100-200 point movement in the Sensex. Bose observed that markets are heading towards 5,800-5,850 and there is not much worry in the short-term.

“Volatility is almost a daily affair now and we are not really bothered by 100-200 points movement in the Sensex these days. If the Nifty were to actually close above 5,700, that would be very positive. If the Nifty manages to close above 5,680, it is good enough. I am still confident that we are at least heading towards 5,800-5,850 and unless we fall again below 5,550, I do not think there is much to worry, at least in the short-term," said Bose.