Domestic & Global Markets Soar

The Indian markets witnessed good movement during the week, with the Sensex and the Nifty crossing the psychological levels of 20k and 6k respectively. The two main indices closed the week with gains of over 2.5% each.

Strong money flows from the US as well as the Japanese markets has been one of the positive factors that have led to this euphoria. The European banks have cut the key interest rates, followed by similar steps in Korea and Australia. The Indian central bank also cut the repo rate by 25 basis points, creating liquidity in the global markets. This was supported by the fall in commodity prices.

On the domestic front, the Index of Industrial Production (IIP) for the month of March 2013 has gone up by 2.5% compared to the level seen in March 2012. This is marginally up from the street’s expectation of 2.1% and much higher than the revised figure of 0.46% for February 2013 (from the previously announced 0.6%). The cumulative IIP growth for FY13 stands at just 1.0%, down from that of 2.9% in FY12.

Gold prices in India, the world's largest buyer of the metal, closed at Rs 26945. Both gold and silver were down by 1.01% and 1.23% respectively.

Money inflows remained strong, with FIIs buying equities worth Rs 5739 crore. DIIs ended the week in the red, selling off equities worth Rs 1389 crore.

On the results front, the aggregate performance of India Inc. has been better than the street’s expectations so far. The results will continue to drive the future course of the markets going forward too. Therefore, some volatile trades may be witnessed in the next week.