Markets may remain volatile
The markets exhibited heavy volatility last week with the broad indices plunging 4.5% during the mid week. However, the indices bounced back and closed at 18,519 and 5471. This is the fifth consecutive negative weekly close for the Indian markets. Not only in India, but almost in all global emerging markets there were sell offs in equity and bond markets due to fears of a tighter US monetary policy.
The rupee hit a life time low of 65.50 on Thursday making it one of the worst performing currency in Asia today. The rupee has fallen more than 20% in less than a year now. The erosion in value is a huge opportunity for FIIs and NRIs to pick up stocks since there is a double advantage of higher convertibility rates for their money and lower equity valuations in India. With the rupee rates playing havoc in the economy, it is expected that the RBI and finance minister will speed up measures for making it stable. As far as Indian investors are concerned, It’s prudent to stay off from the market since there is negative sentiments all around. The derivatives expiry for August contracts is on this Thursday hence volatility cannot be ruled out this week too.
GDP estimates for the first quarter, RBIs measures to support the falling rupee and derivatives expiry will determine the general market trend this week. We expect the markets to trade in a range of 18,100-18750 for the sensex and 5350-5600 for the nifty. Staggered accumulation of beaten down stocks is recommended.
GDP estimates for the first quarter, RBIs measures to support the falling rupee and derivatives expiry will determine the general market trend this week. We expect the markets to trade in a range of 18,100-18750 for the sensex and 5350-5600 for the nifty. Staggered accumulation of beaten down stocks is recommended.
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