Steel Stocks Outlook for the week (18-22.06.2012)
rupeedesk
RUPEE DESK: Steel Stocks Outlook for the week (18-22.06.2012)
Stocks of major steel companies are expected to trade rangebound next week tracking key indices, which will take direction from the Reserve Bank of India's decision on interest rates Monday, and Greece's elections over the weekend. At its mid-quarter monetary policy review, the RBI is expected to cut the repo rate by 25 basis points to 7.75%, which will boost local shares.
Greece's
elections over the weekend will also lend cues to local shares. Shares may gain
if parties that support austerity measures are elected as then the country may
accept a bailout, allowing it to remain in the Eurozone. Investors also will
take cues from the G-20 summit on Monday and Tuesday, where leaders will
discuss ways to boost global growth and tackle the Eurozone debt crisis.
Back home, seasonal slowdown in demand due to the onset of monsoon could
pressurise prices of steel companies' shares. The industry's demand expectation
has tapered down significantly over the last six months and now the industry is
targeting 6-9% growth in next two years as against over 10% growth expectation
some time back.
Most companies have also started adjusting their capital expenditure schedules
to cope with this environment. This could also keep sentiment subdued for
shares of major steel companies in coming sessions.
| By RUPEE DESK |
| rupe...@googlegroups.com |
| www.rupeedesk.in |