Sharply better-than-expected industrial output in November failed to bolster sentiment as the data, while providing a glimmer of hope for the battered economy, could allow the central bank to hold off on easing monetary policy.
Infosys fell 8.4 percent to 2,588.25 rupees as investors braced for earnings downgrades by brokerages after the company trimmed its full-year revenue growth outlook for a second straight time and warned of lower client spending because of the crisis in Europe, its second-biggest market.
How do you see the European crisis panning out in 2012? Will there be further worsening?
We expect the ongoing European debt crisis to cast a shadow on global financial markets and the global economy during 2012, especially, in the first half of 2012. Fresh concerns about the Eurozone debt crisis are likely to emerge in February, with a large tranche of debt auctions in Italy, Spain, Portugal and Greece. These auctions are likely to indicate whether these peripheral economies are able to secure funding at reasonable rates. Eurozone is expected to experience a recession in 2012 with a negative feedback loop between the debt crisis and rising funding costs and the weak economy. We expect the crisis to ease in the second half of 2012, leading to a decline in uncertainty and risk aversion.
What's more threatening for the Indian markets - Eurozone or domestic economic worries?
India will not be immune to negative developments in the Eurozone crisis. Even if the Eurozone fears ease, domestic economic concerns are likely to impact Indian stocks. Indian economic growth could continue to grind lower as high interest rates continue to stifle investment demand. Commodity prices continue to remain elevated and the weak rupee will ensure prices remain high even if they decline globally. These factors will prompt analysts to lower GDP growth forecast. Policy reforms are likely to be put on hold until some of the key state elections are out of the way. These reasons, combined with potential worsening of the Eurozone crisis, could push equity markets lower over near term.
What are the major concerns with respect to Indian markets?
Our major concerns centre around medium-term trajectory for GDP growth and consequently corporate earnings, and policy disappointments, especially, in the infrastructure sector. In the recent past, environment approvals for coal mines, other infra projects have been slow, leading to stress in the power sector - the economy's lifeline.
What's your India market outlook for 2012?
Going ahead, growth is likely to become a priority again for policy makers. Interest rate cuts combined with policy action has the potential to trigger a rally in equity markets in the second half of 2012. We expect rate cuts and lower rates in the system towards the middle of 2012. There's potential for a rally in 2012 for the Indian market. Valuations are attractive, while interest rate headwinds are easing. At current levels, the Indian market is trading at close to 13X one year forward earnings, a discount to its historical trading range. Thus from a valuation perspective, these are good levels for longer term investors. However, Indian equities remain at a premium to other emerging markets.
(source-http://articles.economictimes.indiatimes.com )
What are your sectoral bets now?
affect Europe debt on indian financial markets 2012, indian stock market outlook 2012,Commodity prices, Indian market 2012, interest rate, For the latest updates PRESS CTR + D or visit Stock Market news Today
Related Post:
Indian stock market
- Bharti Infratel IPO issue price at Rs 220 per share
- Maruti Suzuki India stock projections 2013 -2014
- Omkar Speciality Chemicals shares outlook 2013
- Tech Mahindra stock outlook 2012-2013
- MCX Gold trend for november 12-16 2012
- MCX commodities prices expected october 23 2012
- astrological stock market predictions october 15-19 2012
- Indian stock markets forecast october 8-12 2012
- Nifty futures tips october 1-5 2012
- Indian stock market prediction october 1-5 2012
- Religare Finvest ncd issue
- Ranbaxy stock prices forecast 3-7 september 2012
- sme platform release date 9/4/ 2012
- NSE Guidelines SME Platform
- Why Tech Mahindra shares prices down august 30, 2012
- Nifty, Sensex outlook week 27 - 31 august 2012
- Sensex, Nifty rose 8/21/2012
- Shree Renuka Sugars stock outlook next week august 21 2012
- Delta Corp outlook next week august 21 2012
- MCX gold prices outlook week august 21 2012
- Federal Bank projected remittances 2012-2013
- Indian markets nifty outlook august 20-24 2012
- Nifty, Sensex for week july 30-3 august 2012
- mcx crude palm oil prices july 24 2012
- Indian stock market for july 23-27 2012
Buy Pressure is Level 3 Data created bytransforminglevel 2 tick data to create powerful buy sell signals forreal-time stock chartingBuy Pressure
ReplyDelete