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Markets Weekahead – India story looks better; global headwinds could weigh

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The truncated Diwali week saw the Nifty closing at 8,014, recovering from a “breakdown” scare and ending about 3 percent higher to welcome the new Hindu calendar year – Samvat 2071.

The markets were aided by the performance of the BJP in assembly elections and a slew of reforms, which laid to rest the growing sense of inaction on the policy front. These included the long-awaited diesel deregulation, gas pricing and labour reforms, and a roadmap on coal sector reforms.

Development was the key poll plank for the BJP and the state election results will give the central government renewed confidence and impetus to push forward its reform agenda.

The global environment has also been kind. Lower commodity prices, especially crude oil, have truly been a blessing for the government. If oil prices had hovered above $110, there was a bleak chance of either the diesel deregulation or any hope of reining in the fiscal deficit.

India Markets Weekahead: Await a sharper correction to nibble in

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(Any opinions expressed here are those of the author and not of Thomson Reuters)

The truncated week which opened after a five-day vacation was in a sombre mood except on Thursday, when markets bounced back due to a dovish Fed commentary. Friday again saw a correction, with the Nifty closing the week at 7860, down 1.07 percent.

People walk past the Bombay Stock Exchange (BSE) building in Mumbai May 13, 2014. REUTERS/Danish Siddiqui/FilesThe prospect of world economic slowdown perturbed international markets, and the Dow saw its worst week since May 2012, which in turn affected Indian markets. FIIs continued to pull out, increasingly worrying traders who are already baffled by the volatility.

India Markets Weekahead: Continue pruning your portfolio

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(Any opinions expressed here are those of the author and not necessarily those of Thomson Reuters)

Markets began the week on an optimistic note with the Nifty touching a new high of 8,178 but fatigue was noticeable in frontline stocks as action shifted to the mid- and small-caps.

India Markets Weekahead: Time to prune positions in an extended honeymoon

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(Any opinions expressed here are those of the author and not of Thomson Reuters)

The Nifty closed at a new closing high of 7,954 amid volatility in an eventful week that started with the Supreme Court ruling that the allocation of more than 200 coal blocks over the past two decades was illegal.

With nearly 3 trillion rupees at stake, this had a direct effect on the metals and power sector. It also affected banking, which has exposure to the two sectors.

India Markets Weekahead: ‎Tough for the Nifty to break out of its range

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(Any opinions expressed here are those of the author and not of Thomson Reuters)

The Nifty continued its upward trajectory to close at a two-week high of 7,792 in a holiday-truncated week. However, this optimism was not reflected in the broader market, especially the mid caps and small caps.

Among the sectors, public sector banks, realty, infrastructure and capital goods, which led the rally earlier, have underperformed in the last few weeks whereas defensives such as FMCG, pharma and IT stood out, an irony when markets are close to a record high.

India Markets Weekahead: Quality stocks to stand out in next rally

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(Any opinions expressed here are those of the author and not of Thomson Reuters)

Reality finally dawned on the markets and we saw a sharp correction in the last two trading sessions. The Nifty closed at a two-week low of 7603, down 2.41 percent for the week.

Modi mania seems to have abated temporarily and international developments played a bigger role in influencing sentiments. The quarterly results have so far been mixed but decisively points to a slower growth this quarter.

How high will the Sensex go?

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(Any opinions expressed here are those of the author and not of Thomson Reuters)

A bronze bull sculpture is seen as an employee walks out of the Bombay Stock Exchange building in MumbaiSince April, the stock market has been in a frenzy after a long period of utter gloom. In quick succession, the Sensex jumped month after month to cross 26,000 on July 7. This was not mere euphoria created by the election of the Narendra Modi government, with a single-party majority in the Lok Sabha after a long time.

India Markets Weekahead: Tough for Nifty to climb above 7,800

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(Any opinions expressed here are those of the author and not of Thomson Reuters)

Indian markets were unaffected by the week’s international developments, with some help from encouraging domestic macro data and a pep talk by Finance Minister Arun Jaitley in post-budget discussions.

The Nifty recovered from the previous week’s losses, closing 2.67 percent up at 7664. Positive IIP data was followed by benign inflation at 5.43 percent, a four-month low. Monsoon rains, which had been playing truant, recovered substantially with the deficit shrinking to 15 percent below average last week and covering the entire country.

Budget strikes the right chord on reviving investment

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(Any opinions expressed here are those of the author and not of Thomson Reuters)

Finance Minister Arun Jaitley (C) poses as he leaves his office to present the federal budget for the 2014/15 fiscal year, in New Delhi July 10, 2014. REUTERS/StringerPatient, consistent baseline play rather than aggressive serve and volley — that about sums up the Narendra Modi-led government’s maiden budget.

Budget 2014/15 reveals priorities, sets the stage

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(Any opinions expressed here are those of the author and not of Thomson Reuters)

The new Narendra Modi government rides on a long wishlist of policies and reforms, with limited resources. Budget 2014/15, as expected, reveals the government’s priorities in the near and medium term.

Arun Jaitley poses as he leaves his office to present the union budget for the 2014/15 fiscal year in New DelhiThe inflation moderation imperative overshadows near-term headline growth desires, manifested in aggressive (albeit challenging) fiscal deficit targets. The projected fiscal deficit of 4.1 percent (3.6 percent of GDP in FY16) versus the 4.6 percent recorded in FY14, is in line with expectations. The reduction in the budget deficit is driven by hoped-for revenue growth rather than depressed spending growth.

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