17-Apr-2014 
Sensex 22,628.84 (+351.61)
Nifty 6,779.40 (+104.10)
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)

Wednesday, August 24, 2011 11:37 Hrs IST

The Markets Are Now Trading At Less Than 14x FY12 Earnings Which Looks Attractive

DSP BlackRock Mutual Fund - Equity Market Overview

As of 17 August 2011, the Nifty index closed at 5,057, down 7.8% MTD while the Sensex Index closed at 16,841 down 7.5% mtd.

The index of industrial production, or IIP, rose 5.6% in May from a year ago. Manufacturing accounts for about 75.5% overall industrial output. Eight of the 22 manufacturing sectors reported a contraction in output during the month. Production of capital goods, an indicator of investment activity, expanded only 5.9% in May, against 7.3% in the previous month, while that of consumer durables rose 5.2%, compared with 3.7% in April

Headline inflation eased to its eight-month low at 9.22 per cent in July from 9.44 per cent. The non-food category in primary articles recorded a drop to 15.51 per cent in July from 18.57 per cent in June. The fuel and power category also observed a falling trend, from 12.85 per cent to 12.05 per cent in July.

Month to date, the economy has seen FII outflows of approx. USD 1bn from equities, while the YTD inflows have been approx. USD 1bn.

Outlook

The markets have corrected further, down 3% over the last two weeks taking cues from the global news flows. Calendar YTD the Indian market is down 18%

Inflation continues to be at elevated levels, though the softening of commodities and crude oil to help the situation going forward First quarter results have come below estimates at 14% for the quarter ending June 2011

YTD FII inflows have been USD 1 bn

FDI was the strongest during the quarter (June numbers up 310% to $5.68 bn

With this correction, the markets are now trading at less than 14x FY12 earnings which looks attractive

Fall in global commodities on fears of US and Euro zone recession could benefit India

IIP data for June was strong at 8.8% vs. 5.9% in May

With this correction, India's relative valuation is in line with the other emerging markets. It has come down from 35% to 20%

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