Another Difficult Session Ahead For The Investors

It seems that the woes of Indian equity investors do not seem to be abating. The kind of sharp fall the leading indices witnessed yesterday on account of depreciating Rupee against the USD only indicates towards the same. No wonder the leading equity indices took a nose dive. However amid all this, arrived the news of appointment of Raghuram Rajan as next RBI Governor. Known for his strong salesmanship ability, he seems to be appointed as a crisis man in the current situation. However, even news of his appointment could not help arrest any slide in the rupee. It seems that there is herculean task ahead of him and it will surely be a steep learning curve ahead of Rajan.

While this has been the case on domestic front, the situation does not seem to any different on the global front. Yesterday, U.S. stocks fell the most since June 2013 as retailers posted results that disappointed investors while improving trade data fueled concern the Federal Reserve may begin to reduce its bond purchases this year. We had also expected the similar thing to happen and had cautioned our readers. However some part of the globe provided some positive news as the euro gained as reports signaled European economies are recovering. But the equity indices in the Euro zone closed on a negative note only.

As regards the Asian markets, Asian stocks dropped, pushing the regional index down the most in a week, as Japanese shares slid amid a rally in the yen. The Japanese currency touched a six-week high against the dollar, while natural gas futures extended declines and precious metals witnessed a fall.The MSCI Asia Pacific Index lost 0.9 percent by 9:54 a.m. in Tokyo, set for the biggest one-day drop since July 31. Gas futures slipped a fifth day, while gold declined 0.5 percent and silver and copper also witnessed a drop.

As regards the other Asian equity indices the story is no different as Hang Seng, Shanghai Composite and Kospi are still trading in negative zone. However a slimmer hope is emerging for the Indian markets as the SGX Nifty is trading in green with gain of around 25 odd points to trade at 5585 levels. However we are of the opinion that the gains are unlike to sustain and expect the indices to witness a decline as the day progresses. While the global canvass is already red there is not much expected on the domestic front also. Even monsoon sessions of parliament is again expected to be dull with most of the sessions expected to be washed out without any important decision to be taken by the Government.