The week ahead: RBI meet to guide the markets..

The Indian markets closed on a flat note last week with the Sensex and the Nifty ending at 28,115 and 8,533. Both the indices bounced back from intra week lows of 27,416 and 8,321. The recovery was led by banking stocks after the announcement of Rs 70,000 crore over 4 years lifeline to PSU banks by the finance ministry.

Looking back, July was a volatile month with markets swinging heavily on news flow and earnings numbers.  It was very difficult to guess the market direction since most of the time, a decisiveness among participants kept reflecting in market moves. This confusion about the direction of the market still remains and clear direction will surface once the RBI monetary review is done on August 4 2015. RBI has so far reduced 75 basis points this year to boost the economy.

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The week ahead: Expect the markets to trade sideways..

The Indian stock market doesn’t seem to be attractive to investors at the current levels due to over valuation and poor Q1 results. Hence both the sensex and the nifty were moving sideways to finally end at 28,112 and 8,522 respectively. The current valuations are not very attractive for investors to buy more.

Going ahead, we expect the markets to correct a little more in the days to come. The main factors to check this week includes expiry of July derivatives , FOMC meet and quarterly earnings numbers of ITC, Maruthi, HDFC, L&T and ICICI. The markets may show some excitement on Monday morning since last Friday reliance industries reported its highest Q1 results in 7 years due to strong refining and petrochemical profits.

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The week ahead: Poised at critical hurdle…

Positive outcome over Greek bailout, easing of China’s market crash , fall in crude oil prices and Iran’s nuclear deal led to the Indian stock markets logging in the biggest gain in a month during the week that passed by. The sensex closed at 28,463 gaining 802 points and the Nifty closed at 8,610 gaining 249 points. Equity market all across the globe were moving higher.

Going ahead, technically the Sensex and Nifty are now at critical resistance level. Both the indices have reached 61.8% retracement of the previous decline. A reversal from here can pull down the indices to 26,000 and 8,000 respectively. Markets need further triggers that could send the prices surging, but at the moment, it seems like there are no such strong triggers. The 1Quarter earnings numbers too, doesn’t give much hope – revenues and earnings do not show significant improvement. Further the progress of Monsoon has also been quite worrisome. If there is no heavy rainfall in the next 30 days we may have to assume that the Monsoon season was not up to the mark and that could invite further trouble for the markets.

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The week ahead: Inflation data and Q1 to guide the markets..

Erratic progress of monsoon and political scenario resulted in the stock markets closing at 27,661 ( Sensex) and 8,361  ( Nifty).  Although Indian markets closed in red , the fall was only below 2 % – the sensex fell by 432 points and Nifty fell by 124 points. In fact, compared to what happened in the Chinese market, the Indian markets have held its ground. The Chinese stock market last week did not have much impact in India which means that the confidence still remains intact.

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