Markets corrected sharply in the last hour on Friday with the Nifty closing a tad below the crucial 9, mark. Sentiments were upbeat during the initial part of the week but investors turned cautious after the U. The rupee closed at a month high of The Indian currency has gained 5. The central bank however decided to narrow the LAF corridor to 25 bps from 50 bps with immediate effect, implying a 25 bps rise in reverse repo rate at 6 percent.

The RBI also allowed banks to invest in Real Estate Investment Trust and Infrastructure Investment Trust.

This will give banks more investment options and will also have a favourable impact on the real estate and infrastructure sector. Globally, geopolitical tensions intensified after the U. The attack also puts a question mark on the future relationship between the U. Russia has warned of serious consequences to the missile strikes, so geopolitical developments over the next few days would be important.

Back home, automobile sales numbers show that the passenger car, two-wheeler and tractor industry all posted positive growth in while commercial vehicle volumes remained broadly flat. Thus, earnings for Q4 FY17 may show better topline but margins could drop. Secondly, a lot of latent demand would have been satiated due to which demand in April and May could be comparatively subdued.

Indian Stock Market – Bubble Fit To Burst? | DailyForex

Reliance Industries was the top gainer in the index pack, rising However, it corrected after its telecom arm Jio had to withdraw its Summer Surprise offer three months free service after regulator TRAI said it did not fit into the "regulatory framework".

The fact that they were passed without any changes reflects the political consensus on the reform. The GST Council will meet on May to finalise rules and rates.

The coming week marks the beginning of Q4 results season with Infosys reporting its numbers on Thursday. Growth in domestic consumption companies is likely to be in single digits even if the impact of demonetisation is fading.

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On the sectoral front, earnings of consumer staples, discretionary, auto and export oriented companies are likely to remain subdued.

More importantly, investors would be worried about the unabated appreciation of the rupee, which is bound to affect exporters, especially IT and pharma companies.

Additionally, management commentaries of IT firms on client budget, implications of changes in U. Banks are expected to report better profit growth on account of low base but NPA levels would be watched closely. On the macro front, IIP data for February will be released on Wednesday. Industrial production improved 2. CPI inflation data for March is also due on Wednesday.

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It increased to 3. WPI for March will be out on Friday.

Indian stocks: Euphoria without the essentials - Livemint

Markets continue to defy gravity, aided by upbeat sentiments and liquidity not supported by fundamentals. Levels are justified due to scarcity premium, liquidity, technical reasons as well as relative valuation. Normally, there is a gap between fundamentals and market valuation where either of them catches up with the other over a period of time.

But when markets continuously ignore fundamentals and march ahead for a longer period of time, a bubble is formed. We are currently in that zone, thus I would continue to remain cautious. Ambareesh Baliga has about 25 years of experience in the stock market and has worked with Karvy and Kotak groups in the past. He is a regular market commentator on various business channels. He is a commerce graduate from Calcutta University and a qualified cost accountant. LONDON Oil steadied on Wednesday, paring earlier losses, but was set for its largest price slide in the first half of any year for the past two decades, as investors discounted evidence of strong compliance by major producers with a deal to cut global output.

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