Fed’s tapering stayed the talk of the town as markets look exhausted due to lack of any domestic or global cues. The question of will they cut or will not and when continues to linger over the market’s direction.
Sensex lost 0.9%, Nifty lost 1.0% and CNX Midcap was down by 0.9% this week.
Monday – Sensex up by 2.2%, Nifty up by 2.2%, Midcap up by 1.3%
Market continued to rally after Janet Yellen new chair of Fed Reserve allayed fears over QE tapering. Also, RBI governor Rajan’s statement to have an accommodative liquidity stand strengthened the rupee and boosted the investor sentiment.
Tuesday - Sensex up by 0.2%, Nifty up by 0.2%, Midcap flat
Lack of catalysts in the domestic markets makes sure that any rally or euphoria is short lived. Markets were flat as investors stayed cautious and booked profits.
Wednesday – Sensex down by 1.2%, Nifty down by 1.3%, Midcap down by 0.6%
Sensex floundered due to lack of any domestic or global cues. Investors booked profits in banking, IT and capital goods as market sees no new investment and project been announced till the elections are concluded in May.
Thursday – Sensex down by 2.0%, Nifty down by 2.0%, Midcap down by 1.7%
Release of minutes of Federal Open Market Committee (FOMC) meet spooked the investors globally as it indicated tapering might began in next few months, if economy improves. Fed’s doublespeak is confusing the markets as previous week they indicated any tapering is still far away.
Friday – Sensex down by 0.1%, Nifty down by 0.1%, Midcap up by 0.1%
Markets continued to stay cautious as Fed’s comments on tapering confused the investors.
Sunday, November 24, 2013
Two charts that says it all
Well, the conclusion of the charts below is crystal clear. The Fed tapering talk in May, which
led to sharp depreciation in rupee value, has clearly benefited the
firms with significant dollar earnings while domestic environment
continues to remain a hurdle. So, the investors should not be overly complacent if Sept quarter results were not as bad as everyone was expecting them out to be. We need to cover a lot of ground on domestic front to substantiate the India fundamental story.
The first chart is from my first weekly commentary in November. It speaks of the divergence in the market performance of different sectors. IT and Pharma with their export earnings have dominated the returns this year.
While the other one from the house of Motilal Oswal speaks of the divergence in the companies with dollar earnings and domestic earnings.
The first chart is from my first weekly commentary in November. It speaks of the divergence in the market performance of different sectors. IT and Pharma with their export earnings have dominated the returns this year.
While the other one from the house of Motilal Oswal speaks of the divergence in the companies with dollar earnings and domestic earnings.
Sunday, November 17, 2013
Weekly Market Commentary - Nov 11 - Nov 15, 2013
Global markets continue to anchor on central governors’ announcements for directions. This anchoring is making many market participants nervous. As results season nears its end in India, market is struggling to find any catalyst to move up. And as we know, when indices are not moving up, they are moving down. Can’t stay confused/range bound/flat or in inaction for long.
Sensex lost 1.3%, Nifty lost 1.4% and CNX Midcap was down by 1.1% this week.
Monday – Sensex down by 0.8%, Nifty down by 1.0%, Midcap down by 0.9%
Continuing weakness in rupee had its effect on investors. Investors continue to stay cautious as September IIP and October retail inflation numbers are due for release tomorrow.
Tuesday - Sensex down by 1.0%, Nifty down by 1.0%, Midcap down by 1.0%
Although market consensus indicates a recovery in IIP at 3.6% in September vs. 0.6% in August, it is the retail inflation, which is causing nervousness among the participants. Street expects CPI for October to be at 10% vs. 9.84% previous month. Also, car sales, considered by investors as a signal of consumer sentiment, provided little cheer with domestic sales declining 3.9% in October.
Wednesday – Sensex down by 0.4%, Nifty down by 0.5%, Midcap down by 0.7%
Street was little disappointed as IIP numbers came in lower at 2% for September vs 3.6% consensus while CPI was on higher side with rise of 10.09% in October. Investors have again started speculating a rate hike in coming December 18 meeting of the RBI.
Thursday – Sensex up by 1.0%, Nifty up by 1.1%, Midcap up by 1.5%
Markets cheered the Janet Yellen’s statement that US economy is still underperforming and Fed will continue its liquidity support for some more time. Janet Yellen is set to replace Ben Bernanke as Federal Reserve Governor soon.
On domestic front, Raghuram Rajan again sprung back to action and soothes the nerves of the investors with announcement of 8,000 crores of bond buying program to infuse liquidity in the system.
Friday – Markets closed on occasion of Muharram
Sensex lost 1.3%, Nifty lost 1.4% and CNX Midcap was down by 1.1% this week.
Monday – Sensex down by 0.8%, Nifty down by 1.0%, Midcap down by 0.9%
Continuing weakness in rupee had its effect on investors. Investors continue to stay cautious as September IIP and October retail inflation numbers are due for release tomorrow.
Tuesday - Sensex down by 1.0%, Nifty down by 1.0%, Midcap down by 1.0%
Although market consensus indicates a recovery in IIP at 3.6% in September vs. 0.6% in August, it is the retail inflation, which is causing nervousness among the participants. Street expects CPI for October to be at 10% vs. 9.84% previous month. Also, car sales, considered by investors as a signal of consumer sentiment, provided little cheer with domestic sales declining 3.9% in October.
Wednesday – Sensex down by 0.4%, Nifty down by 0.5%, Midcap down by 0.7%
Street was little disappointed as IIP numbers came in lower at 2% for September vs 3.6% consensus while CPI was on higher side with rise of 10.09% in October. Investors have again started speculating a rate hike in coming December 18 meeting of the RBI.
Thursday – Sensex up by 1.0%, Nifty up by 1.1%, Midcap up by 1.5%
Markets cheered the Janet Yellen’s statement that US economy is still underperforming and Fed will continue its liquidity support for some more time. Janet Yellen is set to replace Ben Bernanke as Federal Reserve Governor soon.
On domestic front, Raghuram Rajan again sprung back to action and soothes the nerves of the investors with announcement of 8,000 crores of bond buying program to infuse liquidity in the system.
Friday – Markets closed on occasion of Muharram
Saturday, November 9, 2013
Weekly Market Commentary - Nov 4 - Nov 8, 2013
Markets struggled to find ground as Diwali euphoria dies out. In addition, returning of oil companies to source their dollar requirements from market got the rupee falling again, which worried the investors.
Global investors remained nervous over what continues to be their single most important concern: Will there be talks of Fed tapering or not in the next meeting.
Markets lost all the gains they made previous week. Sensex lost 2.5%, Nifty lost 2.6% and CNX Midcap was down by 0.3% this week.
Monday – Markets closed on occasion of Balipratipada
Tuesday - Sensex down by 1.2%, Nifty down by 1.0%, Midcap up by 0.6%
Markets closed down as India’s service sector activity, as measured by HSBC / Markit purchasing managers index, contracted for fourth successive month as economic uncertainty continues. The index improved to 47.1 in October from 44.6 in September but continued to stay below 50, which indicates contraction.
Wednesday – Sensex down by 0.4%, Nifty down by 0.6%, Midcap down by 0.1%
Investors are treading cautiously as S&P warned that it might downgrade India’s credit rating if next government fails to chart out a path to bring back the country to high growth. S&P currently has 'BBB-/A-3' sovereign credit rating on India with negative outlook. The rating major will conduct its next review after the general elections, which are due by May 2014; unless the country's fiscal or external standing deteriorates.
Thursday – Sensex down by 0.3%, Nifty down by 0.4%, Midcap down by 1.4%
Markets continued to stay range bound as oil companies return to market for their dollar requirements, which had got investors worried over depreciation in rupee. Any further depreciation in rupee may affect FIIs inflow in the domestic markets.
Friday – Sensex down by 0.8%, Nifty down by 0.8%, Midcap down by 0.1%
Markets continued to stay under pressure, as recent depreciation in rupee value brings back the inflation worries. Rise in inflation or inflation expectations may prompt RBI governor to hike rates again raising the cost of doing business in already reeling economy.
Investors were also cautious ahead of Fed meeting as improving US economic conditions fuelled the talks of tapering by US Federal Reserve.
Global investors remained nervous over what continues to be their single most important concern: Will there be talks of Fed tapering or not in the next meeting.
Markets lost all the gains they made previous week. Sensex lost 2.5%, Nifty lost 2.6% and CNX Midcap was down by 0.3% this week.
Monday – Markets closed on occasion of Balipratipada
Tuesday - Sensex down by 1.2%, Nifty down by 1.0%, Midcap up by 0.6%
Markets closed down as India’s service sector activity, as measured by HSBC / Markit purchasing managers index, contracted for fourth successive month as economic uncertainty continues. The index improved to 47.1 in October from 44.6 in September but continued to stay below 50, which indicates contraction.
Wednesday – Sensex down by 0.4%, Nifty down by 0.6%, Midcap down by 0.1%
Investors are treading cautiously as S&P warned that it might downgrade India’s credit rating if next government fails to chart out a path to bring back the country to high growth. S&P currently has 'BBB-/A-3' sovereign credit rating on India with negative outlook. The rating major will conduct its next review after the general elections, which are due by May 2014; unless the country's fiscal or external standing deteriorates.
Thursday – Sensex down by 0.3%, Nifty down by 0.4%, Midcap down by 1.4%
Markets continued to stay range bound as oil companies return to market for their dollar requirements, which had got investors worried over depreciation in rupee. Any further depreciation in rupee may affect FIIs inflow in the domestic markets.
Friday – Sensex down by 0.8%, Nifty down by 0.8%, Midcap down by 0.1%
Markets continued to stay under pressure, as recent depreciation in rupee value brings back the inflation worries. Rise in inflation or inflation expectations may prompt RBI governor to hike rates again raising the cost of doing business in already reeling economy.
Investors were also cautious ahead of Fed meeting as improving US economic conditions fuelled the talks of tapering by US Federal Reserve.
Sunday, November 3, 2013
Weekly Market Commentary - Oct 28 - Nov 1, 2013
Growing inflation, rising NPAs, deteriorating governance and still here we are at record high Sensex. As we all know, this rally is liquidity driven and this liquidity will not stop flowing until March next year. At least that is what street was expecting. I feel unless the rally spreads to midcaps and small caps (as the chart below suggests it hasn’t) it can’t be relied upon and can fizzle out anytime in next two quarters. It is advisable that investors book profits in the names, which have rallied beyond what their fundamentals would suggest.
Sensex gained 2.5%, Nifty gained 2.6% and CNX Midcap was up by 3.5% this week.
Monday – Sensex down by 0.5%, Nifty down by 0.7%, Midcap down by 0.8%
Markets were little jittery ahead of RBI monetary policy review meeting on Tuesday. A 25 bps repo rate hike is widely expected on the street. Fed is also scheduled to meet on Tuesday to discuss their tapering plans.
Tuesday - Sensex up by 1.7%, Nifty up by 2.0%, Midcap up by 1.5%
Markets went up as RBI actions were in line with what street was expecting. RBI raised the repo rate by 25 bps while cutting down the MSF rate by the same amount, thereby bringing the difference between them back to normal 100 bps. Mood was also bullish due to Fed’s decision of keeping their liquidity taps open and short coverings ahead of derivative expiry on Thursday.
Wednesday – Sensex up by 0.5%, Nifty up by 0.5%, Midcap up by 0.1%
Markets continued their momentum from previous day but were largely volatile ahead of F&O expiry next day.
Thursday – Sensex up by 0.6%, Nifty up by 0.8%, Midcap up by 1.5%
Sensex rose to its all time high amidst the sustained buying from institutional investors who ignored the latest Fed pronouncement of stopping the QE sooner than expected. As of now, market is factoring tapering to begin in March next year.
Friday – Sensex up by 0.2%, Nifty up by 0.1%, Midcap up by 1.2%
Strong support from FIIs and Fed’s decision to continue its QE program for now continued to take Sensex to a new high.
Monday – Sensex down by 0.5%, Nifty down by 0.7%, Midcap down by 0.8%
Markets were little jittery ahead of RBI monetary policy review meeting on Tuesday. A 25 bps repo rate hike is widely expected on the street. Fed is also scheduled to meet on Tuesday to discuss their tapering plans.
Tuesday - Sensex up by 1.7%, Nifty up by 2.0%, Midcap up by 1.5%
Markets went up as RBI actions were in line with what street was expecting. RBI raised the repo rate by 25 bps while cutting down the MSF rate by the same amount, thereby bringing the difference between them back to normal 100 bps. Mood was also bullish due to Fed’s decision of keeping their liquidity taps open and short coverings ahead of derivative expiry on Thursday.
Wednesday – Sensex up by 0.5%, Nifty up by 0.5%, Midcap up by 0.1%
Markets continued their momentum from previous day but were largely volatile ahead of F&O expiry next day.
Thursday – Sensex up by 0.6%, Nifty up by 0.8%, Midcap up by 1.5%
Sensex rose to its all time high amidst the sustained buying from institutional investors who ignored the latest Fed pronouncement of stopping the QE sooner than expected. As of now, market is factoring tapering to begin in March next year.
Friday – Sensex up by 0.2%, Nifty up by 0.1%, Midcap up by 1.2%
Strong support from FIIs and Fed’s decision to continue its QE program for now continued to take Sensex to a new high.
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