Saturday, 30 November 2013

Weekly Market Update - 25 Nov to 29 Nov 2013

The market was positive for most of the week showing a negative bias for only a day or two. Once the F&O expiry was done with on Thursday, the market zoomed on the last trading session on expectations of good Q2 GDP figure. The highlights of the week are :

  • Markets started the week on a positive note which was further aided by news of nuclear deal between Iran and the west.
  • F&O expiry does little to change mood. The markets have a decisive positive bias.
  • Markets zoom on the last trading session on expectations of better GDP. 
  • GDP data released. Q2 GDP better than Q1 at 4.8% as per expectations.

It was a positive week for the markets by-and-large. The markets started with good upside on the first trading session and was further aided by the news that Iran has reached a deal with the west regarding its nuclear programme. It will mean lifting of sanctions imposed on Iran partially, thus easing trade of oil with Iran. This will relieve pressure on crude prices leading to a general fall in prices of crude oil globally.

There were some negative trends in the markets in the middle of the week owing to the approaching F&O expiry and profit-booking. But once the F&O expiry was dealt with, the markets again zoomed on expectations of good GDP figures.

The GDP figures were released for Q2 FY2013-14 after the market hours on 29th Nov. The GDP grew 4.8% in Q2 compared to 4.4% figure which was posted in Q1. The growth was backed by good agricultural sector performance and also a reviving industrial growth. Although the growth still stood below 5% mark, it is widely expected that the second half of the current fiscal will be better than the first half going by these figures and a good monsoon.

The next week may see the markets reacting to the good GDP numbers and may continue to have a positive bias. But the markets are in-general rangebound due to the lack of any concrete triggers and overall economic situation which has still to improve a lot. Due to this the upsides will be limited at these levels. The FCNR(B) swap window provided by the RBI has closed on Nov 30th and it remains to be seen if it has any effect on the money markets.

On the other hand, the Ninth Inter-Ministerial conference of WTO is being held in Bali between 3rd and 6th December in which India aims to secure its ambitious Food Security plan from possible penalities by the WTO. The trend and the outcome of the meet may also affect the mood of the markets and should also be closely watched.