Expert Zone
Straight from the Specialists
GAAR-supported bounceback tough to sustain
(The views expressed in this column are the author’s own and do not represent those of Reuters)
A reversal after four weeks of gains saw the Nifty closing 2.38 pct lower at 5258. The mid-cap segment of the market caved in earlier with the large caps holding fort till Thursday. The Parliament logjam continued on the “Coalgate” issue and hopes of any worthwhile business being conducted in this monsoon session are dim. Given the political scenario, the war-rooms of political parties are getting into election mode, which could be earlier than 2014. This too will hardly raise hopes for Indian markets as the electorate seems too fractured to have a strong government which would have the ability to push through reforms, including non-populist ones.
Finance Minister Palaniappan Chidambaram who had raised hopes of implementing far-reaching reforms may not be third-time lucky. Though he has been among the most effective finance ministers in the past, the performance is also a factor of the environment which is not conducive currently. Apart from negating the effects of GAAR and tinkering with minor irritants in the system, I doubt whether he will be able to take any path-breaking measures. The Direct Taxes Code too has been deferred by a year.
World markets also ended the week on a softer note though Friday saw improved sentiment with Fed Reserve Chairman Ben Bernanke defending earlier stimulus measures. The European Central Bank meets on Thursday and the U.S. monthly jobs report on Friday would be keenly watched. China manufacturing PMI for August fell to 49.2 pct indicating a shrinkage as the result of the euro zone slowdown. This in turn will have a negative effect on commodities, especially metals and drive the authorities for further stimulus.
Hopes fade as investors await concrete action
(The views expressed in this column are the author’s own and do not represent those of Reuters)
It was an action-packed week for the markets but not for the reasons we had anticipated. Manmohan Singh’s government, which was expected to announce a string of policy action steps starting with a diesel price hike, failed to make any announcements which would have cheered markets.
Get set for an action-packed week
(The views expressed in this column are the author’s own and do not represent those of Reuters)
Markets continued to display weakness during the week except for a spirited, though limited, rally on July 18 after the UPA convinced belligerent ally Mamata Banerjee to fall in line for the presidential elections. The Nifty lost 0.4 pct to close the week at 5205 on political worries after the NCP, another government ally, expressed dissatisfaction with its functioning.
Markets await rollout of policy action
(The views expressed in this column are the author’s own and do not represent those of Reuters)
We saw some tiredness in the markets with subdued optimism as compared to the previous 4-5 weeks as the bouncebacks were not as sharp and strong. The Nifty tended to close at the lower end of the band at 5227, a fall of about 80 points. A major disappointment during the week was the below-expectation result from IT bellwether Infosys followed by a lower annual guidance.
India Market Weekahead – Time to book partial profits
(The views expressed in this column are the author’s own and do not represent those of Reuters)
A stupendous rally towards the end of June was followed by consolidation in the first week of July. Though the benchmark Nifty index ranged in a narrow band of 60 points between 5270 and 5330, the broader market especially the mid-caps were in focus with some of them returning more than 20 pct during the week. After a long time we saw domestic investors returning to the equity markets albeit with a lower risk appetite.
India Market Weekahead – PM’s call for “animal spirit” gets the bull raging
(The views expressed in this column are the author’s own and do not represent those of Reuters)
The last trading day of June brought back memories of a raging bull market with a single-day gain of over 2.5 pct while the month ended with a 6 pct gain. On taking over the finance portfolio, Manmohan Singh along with his ‘dream team’ seems determined to revive both domestic as well as institutional sentiment. It started off by mending announcements made by his predecessor, especially the general anti-avoidance rules (GAAR) which kept foreign investors away in the last few months.
India Market Weekahead: Time to buy after a period of caution
(The views expressed in this column are the author’s own and do not represent those of Reuters)
Markets opened with a healthy dose of optimism last week. Two big events were expected to boost sentiment. On the global front, Greece election results eased fears of immediate global financial turmoil. Back home, expectations were high of an interest rate cut by the Reserve Bank of India (RBI) to boost the falling economy.
India market weekahead – Watch out for Greece and RBI policy review
(The views expressed in this column are the author’s own and do not represent those of Reuters)
The markets remained highly volatile during the entire week as investors remained ambivalent about the likely outcome of the elections in Greece and the Reserve Bank of India (RBI) policy meet.
India Market Weekahead: Book out partially to play safe
(The views expressed in this column are the author’s own and do not represent those of Reuters)
After a sell-off in May, the mood has turned upbeat so far in June with benchmark indices hitting a one-month high against our expectation last week that the markets could remain subdued.
India Market Weekahead – Brace for lows
(The views expressed in this column are the author’s own and do not represent those of Reuters)
Equities reacted sharply due to continued concerns over the euro zone crisis and particularly Gross Domestic Product (GDP) growth numbers which were much below the most pessimistic forecast. Minor relief in the form of favourable opinion polls in Greece along with expectations for a policy stimulus in China to support growth failed to provide the necessary impetus to take the Nifty beyond the 5000 mark on a sustainable basis.
