Equity Research Weekly Market Outlook Report By Mansukh 30th-April-2011

SNAPSHOT

Local Bourses prolonged their losses for the fifth straight session lacking support at higher levels, thereby snapping the week with loss of over 2%. Persistent selling pressure in view of sustained capital outflows by foreign institutional investors coupled with selling across the global equities led to the damage at Dalal Street. The 50 scrip index'Nifty --on National Stock Exchange plunged in trade thereby marking sluggish start for the new F&O expiry series on Friday as investors braced for a hawkish statement from the Reserve Bank when it releases its policy on Tuesday. Financials led the decline with the market expecting the Reserve Bank of India (RBI) to raise key short-term rates by at least 25 basis points to rein in high inflation. It would be the ninth increase since mid-March last year. India VIX, a gauge for market's short term expectation of volatility lost 6.40% at 19.58 from its previous close of 20.92 on Thursday. The S&P CNX Nifty lost 34.50 points or 0.60% to settle at 5,750.95. The index touched high and low of 5,804.30 and 5,706.05, respectively. 24 stocks advanced against 26 declining ones on the index.

WEEK GONE BY

Indian equity indices went through a turbulent week as they failed to negotiate a close above the neutral line for even a single session and eventually snapped the week with a cut of over two percent. The week largely remained characterized by choppiness because investors were reluctant to pile up positions and indulged largely in stock specific activities as

corporate India continued to divulge their fourth quarterly report card. Volatility gradually accelerated session after session as the April series Futures and Options settlement neared while quarterly earnings' announcements by RIL, Wipro, Bank of Baroda, Ambuja Cement, Crompton Greaves, TVS Motors were punished badly as they remained below Street's expectations. On one hand spiraling international crude oil prices become the headache of policymakers while on the other, worries over global economic recovery loomed large, given the fact that world's biggest economy continues to grow at a tepid pace. Updates from the 2G case trial kept hitting headlines through the week thereby weighing down sentiments and prompting investors to book profits in scam linked shares like RCom, Unitech and DB Realty. The April series F&O settlement day turned out to be another pathetic trading session for the Indian stock markets as the selling pressure gathered greater momentum after government released the disappointing food inflation numbers which stayed absolutely flat at 8.76% on annual basis during week-ended April 16 compared with 8.74% recorded in the previous week.

Read more about Weekly market outlook

Related post about Equity Research Weekly Market Outlook Report By Mansukh