Pre Open Thoughts: Clueless Direction!!
Ø The doors we open and close each day decide the lives we live. A cautious start and muted morning trade is in the offing as investors remain on tenterhooks before the RBI’s latest policy announcement. The doors remain wide open as few Chief executives of banks, who feel the deteriorating pulse of the economy, told Reserve Bank of India Governor Duvvuri Subbarao that interest rates and cash reserve requirement have to be lowered to revive investments and demand. Till then market participants rather clueless about the market’s near-term direction.
Ø Meanwhile, the probability of a CRR cut has gone up due to persistently tight liquidity. Still, it will be better to adopt a wait and watch approach.
Ø Results will continue to pour in as earnings season will also kick off on Friday the 13th beginning with Infosys' results.
Ø On the other hand the rupee and the Government’s fiscal profligacy are among the other factors playing on the RBI’s minds. While the rupee has strengthened a wee bit, lack of comfort on the fiscal front is a cause for concern.
Ø On Global front the latest FOMC minutes last week have put paid to any hope of QE3 for the time being. Crude oil is not showing any signs of cooling despite slowdown in China, as geopolitical concerns still prevail.
Ø The Nifty has failed to close above 5360. It is likely to face resistance at 5390-5400 while support will be lower to 5260-5280 levels.
Ø Telecom Stock will be in focus as India's Supreme Court on Wednesday rejected appeals to overturn an order cancelling telecom licenses awarded in 2008, dealing a blow to the companies affected. Mobile operators including Telenor and Sistema's Indian joint ventures and Indian companies Idea Cellular and Tata Teleservices had filed separate pleas seeking a review of the court's decision.
Ø In other news, Reliance Industries Ltd is set to make its debut in the marketing of imported natural gas through India Gas Solutions its equal JV with BP.
No comments:
Post a Comment