Pre Open Thoughts: Dent In Credibility!!

Pre Open Thoughts: Dent In Credibility!!

Ø  You must stick to your conviction, but be ready to abandon your assumptions. Mounting evidence of an economic slowdown has resulted in a short supply of confidence and conviction.

Ø  There is no end in sight to the ongoing selloff in the Indian equities at the moment, as the Government continues to dither on key reforms and the central bank is running out of options to shore up the markets. The outcome is deteriorating economic fundamentals, weak business environment, pressure on corporate earnings, FII outflows and further dent in India's credibility. It remains to be seen how the RBI reacts to these data points.

Ø  The rupee erased all gains & closed at a new all-time low on Monday

Ø  Moody's has cut its rating for state-run Life Insurance Corp of India (LIC) two weeks after it put the country's largest portfolio investor under review for a downgrade over its high exposure to sovereign debt and lack of revenue sources outside of India. Moody's also downgraded the financial strength ratings (BFSR) of ICICI Bank, HDFC Bank and Axis Bank.

Ø  Meanwhile, in the forthcoming foreign trade policy (FTP), which is slated to be declared in the first week of June, is likely to have some incentives for export sectors to support them from the slowdown in international market.

Ø  Greece is back in focus globally amid mounting fears that the indecisive outcome of elections is pushing it to the brink yet again.

Ø  Coming to the markets, the key indices may open on a negative stance owing to weakness worldwide. Trading won’t be easy as volatility will remain elevated as uncertainty will prevail over macro-economic conditions.

Ø  The Nifty Index is now expected to head lower till 4700-4750 with resistance around 4980-5000 in the immediate run.

Results Today:

Cummins India, Unitech Shree Cements Gammon India, Dishman Pharmaceuticals and Chemicals Pantaloon Retail (India), Aditya Birla Nuvo, Videocon Industries, MMTC, India Infoline, Deccan Chronicle Holdings, Essel Propack, Firstsource Solutions, Varun Shipping Co., Elder Pharmaceuticals, Shiv-Vani Oil & Gas Exploration Services, Reliance Mediaworks, C. Mahendra Exports, Emco, Assam Company India, Karuturi Global, Atul.

Global Data Watch today:

EU EcoFin Meeting, Australia RBA Meeting’s Minutes, Japan Consumer Confidence Index (Apr), Germany Q1 GDP, UK Trade Balance (Mar), EU Q1 GDP, EU ZEW Survey – Economic Sentiment (May), Germany ZEW Survey, US Consumer Price Index (Apr), US NY Empire State Manufacturing Index (May), US Retail Sales (Apr), US Business Inventories (Mar) and US NAHB Housing Market Index (May).