It’s a big day for global markets as the world awaits the outcome of Jackson Hole symposium to which our market will react on Monday. For starters, Jackson Hole symposium is an annual conference hosted by Kansas City Fed, one of the 12 regional Federal Reserves created by the US government. In most cases, this summit sets the agenda for monetary policy in the US and this time it is important given the recent noise surrounding the taper talk.

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The US market slipped overnight as the market awaits the outcome of this meet and the Dollar inched up. This is classical risk-off. However, the Indian market of late has shrugged off this risk-off talk and has consistently made a new high even though you could argue about the narrow nature of the rally as the midcap index has underperformed by 7 percent in August.

Today also marks the start of a new series so it’s important to look beyond the Jackson Hole event. Now as you all know, I give a lot of importance to anecdotal data and one data which stands out is that September is a big month for Nifty. Over the last 4-5 years, it has moved 600-800 points every September. And in that context, it’s important to point out that the series starts on a heavy note with Nifty futures Open Interest of 1.24 crore being on the higher side.

Now just because market is heavy does not mean it goes down. It just makes markets vulnerable to any bad news considering we are at all-time high and there is now clear sign of overvaluations in many pockets like IT which has led the rally through the year.

The other big question that will get answered in September is if the broader market shakeout is done or is there more to go.