Straight from the Specialists
High drama in parliament and volatility in the markets, albeit within a tight range, summarizes the action for the week.
Most in the analyst fraternity including myself expected the Nifty to cross the psychological barrier of 6000 after the FDI vote in parliament, but markets defied consensus once again and ended up a paltry 0.4 percent for the week at 5907.
FDI in retail is only a sentimental booster and is not expected bring in a gush of overseas funds in the sector, especially the listed entities. Implementing FDI in retail will be a state subject and even those states ruled by parties indirectly supporting the cause may find it politically difficult to introduce the measure. Secondly, the current term of the UPA government ends in 18 months, which will make foreign investors wary of investing immediately.
The mood continues to be cautiously upbeat for upcoming bills in parliament, especially the ones having direct implication on the financial markets such as pension, banking regulation, microfinance and insurance.