Looking Forward and Week gone by Indiabulls research,

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The Week Gone By
Indian markets wrapped the week on a flat note. The indices
belled the week on positive note onthe back of better than
expected Q2 results of L&T and housing finance major HDFC's .
However, thereafter markets tumbled due to shifting of funds by
investors towards the primary market to subscribe IPO of Coal
India. Later in the week, higher volatility was seen ahead of the
expiry of the October 2010 contracts.
Looking Forward
Industrial output in August grew at the slowest pace in 15
months at 5.6%, nearly half of last year is a cause for concern.
We expect In Q2FY11 the overall margins of corporates are
expected to be under pressure due to higher input & interest
cost as in the June quarter. Among the sectors, Banking, Metals
& Consumer Durables could positively surprise, while FMCG, IT,
Cement & Autos are expected to deliver results in line with the
expectations. Overall corporate earnings growth is unlikely to
match the pace of rise in the stock prices in the near term. So it
undergo a correction before the next upmove begins. Further,
Inflows into secondary equity markets could be hit in the
immediate short term due to diversion of funds to the mega Rs
15000-crore Coal India IPO. The issue was subscribed more
than 15 times. Pressure on fund outflows will ease in late
October 2010 or early November 2010 as Coal India begins to
refund excess subscriptions received towards its initial public
offering. Any correction, if it takes place, is expected to be short
lived in near term & a dip of 5-7% from current levels should be
considered as a buying opportunity. Investor's will eye on Q2
earnings of Heavy weights like BHEL, Maruti Suzuki, Union
Bank, SAIL, ONGC and PNB which are due next week.
However, Global cues and fund flows will remain key for the
market.