India Markets Outlook for the week (11 - 15.06.2012)

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Jun 9, 2012, 6:57:35 AM6/9/12
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RUPEE DESK - India Markets Outlook for the week (11 - 15.06.2012)

 

Domestic equities will look at overseas markets for direction on Monday, but the trend for the rest of the week will be set by India's industrial production growth data for April on Tuesday, and the inflation data for May on Thursday.


Prospects of a rate cut from the Reserve Bank of India have improved due to a spate of recent disappointing economic data and after Australia and China cut benchmark interest rates to bolster growth in their economies.


India's industrial production contracted for the first time in five months in March to 3.5% compared to a growth of 4.1% in February. The gross domestic product growth slowed to 5.3% in Jan-Mar compared with 6.1% in the preceding quarter, and 9.2% a year ago.


While addressing the media on the sidelines of Skoch Summit, RBI Deputy Governor K.C. Chakrabarty, however, said that inflation continued to be a priority area for the central bank. In April, India's headline inflation rate based on the Wholesale Price Index rose to a two-month high of 7.23% from 6.89% in March.

Rate-sensitive sectors--automobile, banks, capital goods, realty, and infrastructure will see some price action prior to the IIP and inflation data.

 

Significant buying seen in the bank space last friday helped the Bank Nifty index end up 0.5% at 9998.85 points. It (Bank Nifty) is now trading around its important psychological level of 10000, which was acting as strong support some months back and now can act as resistance.

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