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India Weekly Kickstart
Portfolio Strategy Research
Quantum of rate hike surprises markets (-3% wow), puts RBI firmly ahead of the curve
All sectors ended in the red with Public Sector Banks & Energy losing 5.5% and 4.1% respectively wow.
Weak foreign inflows of US$ 149mn, DIIs were also net buyers (of US$ 204mn), as of close of July 27, 2011.
Nat. Gas (-5.1%) led Energy (-2.4%) lower wow. Guar Seed (+8.1%) gained the most again this week.
Our GS ECS Research team believes there is a high probability that the RBI is done with rate hikes for now
Overview
Markets fell almost 2% on Tuesday after the RBI
raised the repo rate by 50bps, ahead of our and
consensus expectations of 25bps. NIFTY lost 2.7%
wow in a decline that spanned across sectors.
The GS ECS Research team is of the view that
with this move, the RBI is now firmly ahead of
expectations compared with earlier when it
needed to play catch-up with upward surprises to
inflation. Sharp downgrades to Energy stocks this
week meant that MSCI India continued to see
negative earnings sentiment (-7%) this week.
NIFTY price performance
NIFTY was down -2.7% wow & has lost 10.6% ytd
Source: NSE, DataStream, GS Global ECS Research.
Foreign and domestic flows
Foreign buying has totaled US$ 2.2bn ytd, while
DIIs have bought US$ 3.0bn as of the close of July
27, 2011.
Earnings sentiment
MSCI India Energy had the weakest EPS sentiment
(-19%) wow.
Commodities
Energy (-2.4%) underperformed while Agriculture
(+1.2%) outperformed commodities (-0.5%) wow.
Focus page
Correlation Insights: Aggressive tightening has
been followed by a decline in equity correlation.
Economic Events & Earnings Results
Exports & PMI (Aug 1); 1QFY12 results: DLF (Aug
2); Bosch & Ranbaxy (Aug 5).
India Equity Research Reports, IPO and Stock News
Visit http://indiaer.blogspot.com/ for complete details �� ��
India Weekly Kickstart
Portfolio Strategy Research
Quantum of rate hike surprises markets (-3% wow), puts RBI firmly ahead of the curve
All sectors ended in the red with Public Sector Banks & Energy losing 5.5% and 4.1% respectively wow.
Weak foreign inflows of US$ 149mn, DIIs were also net buyers (of US$ 204mn), as of close of July 27, 2011.
Nat. Gas (-5.1%) led Energy (-2.4%) lower wow. Guar Seed (+8.1%) gained the most again this week.
Our GS ECS Research team believes there is a high probability that the RBI is done with rate hikes for now
Overview
Markets fell almost 2% on Tuesday after the RBI
raised the repo rate by 50bps, ahead of our and
consensus expectations of 25bps. NIFTY lost 2.7%
wow in a decline that spanned across sectors.
The GS ECS Research team is of the view that
with this move, the RBI is now firmly ahead of
expectations compared with earlier when it
needed to play catch-up with upward surprises to
inflation. Sharp downgrades to Energy stocks this
week meant that MSCI India continued to see
negative earnings sentiment (-7%) this week.
NIFTY price performance
NIFTY was down -2.7% wow & has lost 10.6% ytd
Source: NSE, DataStream, GS Global ECS Research.
Foreign and domestic flows
Foreign buying has totaled US$ 2.2bn ytd, while
DIIs have bought US$ 3.0bn as of the close of July
27, 2011.
Earnings sentiment
MSCI India Energy had the weakest EPS sentiment
(-19%) wow.
Commodities
Energy (-2.4%) underperformed while Agriculture
(+1.2%) outperformed commodities (-0.5%) wow.
Focus page
Correlation Insights: Aggressive tightening has
been followed by a decline in equity correlation.
Economic Events & Earnings Results
Exports & PMI (Aug 1); 1QFY12 results: DLF (Aug
2); Bosch & Ranbaxy (Aug 5).
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