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India Markets Weekahead – An opportunity for investors

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

Indian markets were down for a third consecutive week with the Nifty closing 2 percent lower at 5565 on weak economic signals and disappointing corporate results.

The rupee held on at 60.67 to the dollar.

The appointment of Raghuram Rajan as the next governor of the Reserve Bank of India (RBI) brought the market some cheer. Rajan, a former chief economist at the IMF, is seen as a pro-growth policymaker.

International markets ended weak on concerns that the U.S. Federal Reserve could taper down its stimulus programme. Positive data on the Chinese economy was probably the only redeeming feature.

This week, the Companies Bill replacing the Companies Act of 1956 was passed in the Rajya Sabha. This should lead to better corporate governance and investor protection, which our markets need to restore confidence. The trust deficit seems to be at an all-time high with stocks getting butchered at the first whiff of trouble.

India Markets Weekahead: Prudent to hold cash

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Indian markets ended steady on Friday after rising to its highest intraday level in nearly two months. The Nifty closed up 0.33 percent at 6029, marking its fourth weekly gain.

A weakening rupee led to intervention by the Reserve Bank of India (RBI), which tightened liquidity and lifted short-term interest rates on Monday. Though the central bank’s stance against currency speculation has made it all the more difficult for speculators, it also sent bond yields soaring and led to concerns that an increased cost to borrowers would curtail growth that is already limping at 5 percent. Bond portfolios recorded losses, wiping out gains over the last few months.

India Markets Weekahead: Volatility to continue in results season

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

After a spirited rally the previous week, the Nifty moved in a band of 150 points between 5750 and 5900, ending with modest gains of 0.53 percent at 5868. It may seem small but the extreme volatility within this band caught traders on the wrong foot.

Time and again, markets prove that predicting them in the short run is hazardous. Investors welcomed the government’s bold decision to increase gas prices but reacted negatively to its ordinance on the food security bill. The already weak rupee cracked further to 60.35 against the dollar as the election gimmick could cost the state exchequer over $20 billion.

India Markets Weekahead: A spirited rally may be a distant dream

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

The week began with the Reserve Bank of India (RBI) maintaining status quo on rates as expected at its mid-quarter monetary policy review. The trade deficit widened to $20.14 billion, a seven-month high and up 13.18 percent over the previous month. Gold seems to be the culprit again and government restrictions don’t seem to deter Indians from buying gold.

The markets held on to hopes that U.S. Federal Reserve chief Ben Bernanke could bring cheer but the indication of a roadmap for a QE3 pullback saw the dollar rally against most currencies. The rupee was among the worst performers, falling close to 60 against the dollar.

India Markets Weekahead – Volatility seen as RBI policy review in focus

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

Volatility is here to stay and trying to predict the markets on a daily basis is a futile exercise. It’s no better than tossing a coin.

Monsoon rains are early and heavier then normal, raising the hopes of green shoots in the next few months. Macro numbers were showing signs of bottoming out but the rupee slide has thrown calculations awry. A feeble request by the finance minister urging people to shun gold won’t do much good in a country enamoured by gold.

India Market Weekahead – Inflation, FII inflows to be key

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

The bulls are back and their four-week winning streak saw the Nifty close at a 29-month high of 6107 on Friday, up about 2.75 percent for the week. Liquidity flows remain robust, fuelling the momentum despite political heat in New Delhi.

The Congress win in Karnataka boosted positive sentiment, followed by industrial output data that was marginally better than expectations. The overall earnings season has been favourable and along with the global rally provided the right environment for the markets to cross the psychological barrier of 6100 in the Nifty and 20000 on the Sensex. The only thing missing is euphoria on the street and broader participation by investors.

Markets Weekahead: Not the right time to buy

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

The markets continued their winning streak in the past week, with the Nifty gaining another 1.52 percent to close at 5871 on Friday.

The yen impact helped Maruti surprise even the most optimistic earnings estimates and its stocks jumped 5 percent to close at a lifetime high of 1673 rupees. The company seems richly valued and does not take into account the slowdown which we may encounter over the next few months.

India Markets Weekahead: Time to wait and watch

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A volatile week saw the Nifty closing 0.45 percent lower at 5528 after disappointing numbers from IT bellwether Infosys, which missed expectations on most parameters. The Bangalore-based company’s results also affected other IT stocks, with a number of them closing lower.

The markets have again proved that the biggest challenge for industry leaders is to manage expectations. Infosys, which was given a big thumbs-up after spectacular December quarter results, was pushed back to levels from where it had earlier risen like a Phoenix.

India Markets Weekahead: Beware the Ides of March

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Markets ended budget week below support levels of 5800/5840 and just when the six-month rally seemed over for good, it made a spirited V-shaped recovery to close at 5946 on Friday, with gains of 3.95 percent. The Street is divided with some expecting this to be the beginning of a new rally with the market scaling highs that it missed in February; others see it as a strong pullback which will fizzle out soon.

The government seems to be responding faster to allay investor fears. It was quick to respond to FII worries over proposed changes in tax residency certificates. Finance Minister P. Chidambaram has been assuring investors of continued policy measures, including the Direct Taxes Code (DTC) bill being introduced in the current parliament session.

India Markets Weekahead – Opportunity for those who missed out rally

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

It was a second straight week of losses of 1.59 percent with the Nifty closing at 5,903. As discussed in this column a fortnight back, we are in a phase which would tire out the participants and change the mood to a negative consensus on the street.

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