16-Apr-2014  9:31:00 AM
Sensex 22,511.18 (+26.25)
Nifty 6,738.25 (+5.15)
Compare Performance Equity Sectoral Tax Planning Balanced Gilt Bond Liquid Index Pension
 Home|Contact Us
Login       
Password
 Remember my Userid
New User - Register?
Forgot Password?
Latest NAVs
 Funds Reckoner
 Scheme Profile
 Scheme Comparison
 Fund Screener
 Return Calculator
Get Holdings
 Mobilisation Trends
 Trends in Transactions
 News
 Stock Watch
 Offerings
 Dividends
 Top Holdings
 Rankings
 NFO Analysis
 Portfolio
 -Analysis
 -What's In What's Out
 Fund Managers
 -Interviews
 -Survey
 -Performance
 -From the Desk
 Special Feature
 Malegam Committee
 Report
 FAQs
 Glossary
 SEBI Investor Education  Programme
 Tutorials
From the Fund Managers Desk 1x1pix.gif (807 bytes)
1x1pix.gif (807 bytes)

Monday, October 25, 2010 17:12 Hrs IST

Global Macro Data, Institutional Flows and Corporate Results for the Jun-Sep Quarter Should Provide Further Direction to the Stock-Market

Equity Market Outlook, DSP BlackRock Mutual Fund, 22 October 2010

The Sensex and the Nifty indices have seen sharp movement on either side during October. However, on a mtd basis, the markets remain marginally negative. As of October 20, 2010, the Nifty index closed at 5,982.1, down 0.8% and the Sensex Index closed at 19,872.2, down 1.0%.

The Industrial Production (IP) growth for August decelerated to 5.6% y-o-y compared to 15.2% y-o-y growth in July (revised upwards from 13.8% y-o-y earlier) and 5.8% y-o-y growth in June. On a seasonally adjusted basis the IP index was down 6.7% m-o-m (compared to (+) 7.5% m-o-m) in July. The key reason for this deceleration is the volatile capital goods component (-2.6% y-o-y in August against 72% y-o-y in the previous month). IP ex Capital Goods decelerated to 6.8% y-o-y in August compared to 7.4% y-o-y in July on account of base effect. Inspite of this, the other key variables such as passenger car sales, two wheeler sales and tax revenue collections did not show any major deceleration.

The WPI headline inflation came in slightly higher than expected in September, accelerating to 8.6% y-o-y compared to 8.5% y-o-y in August. Food inflation accelerated to 10.8% in September compared to 10.6% in the previous month while non-food inflation continued to remain high at 7.8% in September compared to 7.7% in August.

On an overall country level, the rainfall for the season (June-September) was 102% of its long period average.

Month to date, the economy has seen FII inflows of approx. USD 4.3bn into equities. On an YTD basis, there have been inflows of approx. USD 23.6bn.

Outlook

As global macro economic data continues to disappoint, concerns regarding further quantitative easing by developed nations and currency wars remain at large. Indian macro economic data, however, seems to present a mixed picture. While on ground macro variables such as tax collections, non-oil imports, passenger car sales and industrial production remain steady, inflation continues to remain high as does the current account deficit. A deluge of inbound flows have, however, ensured continued buoyancy in Indian equities. Factors such as global macro data, institutional flows and corporate results for the Jun-Sep quarter should provide further direction to the stock-market.

Previous Stories
More
Other Stories
  Guide to the Markets Asia (21-Mar)
  The front end of the curve looks relatively attractive in the current situation on a risk reward framework-Navneet Munot, CIO, SBI Funds Management (9-Dec)
  Fears of an early taper in light of stronger than anticipated data last week have receded (18-Nov)
  RBI will not hesitate to increase the Repo Rate further, if the inflation remains uncomfortably higher than the RBI's own projections (30-Oct)
  We believe that the 10 year bond yield will range between 8.40%-8.80% levels (30-Oct)
  The policy review will throw light on how RBI weighs the growth-inflation trade-off (28-Oct)
  Investors should take advantage of current pessimism to get exposure to long term stories (28-Oct)
  Monsoons have been good and agricultural growth has picked up which remains a key positive going ahead-Equity Market-Deutsche Mutual Fund (23-Oct)
  The trajectory of inflation, especially the Consumer Price Index may determine further moves in the repo rate (22-Oct)
  We expect bond yields to remain range-bound with the benchmark 10Y G-sec yield trading between 8.5% to 9.0% in the near-term (22-Oct)
Next

Top