Market downtrends, Infosys tax issues!

Investors in India are well aware of the positive and negative surprises of the volatile market. After four days of consecutive rise, indices of both the Indian bourses fell from near two and half year high. While the sensex fell 62.14 points (0.31 percent) to end at 20,223.98, the Nifty fell 30.40 points (0.49 percent) to end at 6,156.90.

Among the major losers were banks led by ICICI Bank; profit booking of rate sensitive stocks led to the fall. Drug makers were equally hit with the government’s announcement of a new drug pricing policy, directed towards increasing the number of drugs (subject to price caps) considered essential.

On the other hand, Infosys Ltd is creating news related to tax issues. The country’s second largest software services provider is all geared up to challenge the Indian income tax authorities of their raising of a tax demand of 5.77 billion rupees earlier this month.

The big market downtrend and inflation slowdown!

Delivering surprises are but humdrum affairs for both the indices of the Indian bourses. A positive sentiment pervaded across the Indian market when the sensex crossed the 20,000 mark. And then, it declined 2.14 percent to end at 19,691.67 today. The Nifty exhibited a similar downtrend, falling 2.08 percent to end at 5,980.45.

The biggest loser was ITC Ltd. that slumped by 5.2 percent on profit booking. Amid other major losers is TCS, falling by 2.6 percent on continued apprehension about a US immigration bill. It was indeed a panicky situation for investors and stock brokers alike.

Meanwhile, another breaking market news is CPI data or India's annual consumer price inflation slowing to 9.39 percent for the second straight month in April. While food prices mounted an annual 10.61 percent in April against 10.61 percent in March, consumer prices went up 10.39 percent in March. Inflation recorded in April eased to 5.50 percent, its lowest level since November 2009.

The Rising Inflation Phenomenon!

It is no big surprise for inflation to go high. India February inflation data well justifies the fact. The Feb WPI (main inflation indicator) went up to an annual 6.84 percent, which is higher by 0.30 percent of what analysts estimated. It was 6.62 percent in January. Non-food inflation slowed to 3.8 percent during the same period. February Inflation data report surged the otherwise falling India Stock market.

To add to this economic disadvantage is incessant weakness in economic activities. The situation has generated hopes amongst analysts about a possible rate cut by the RBI by at least 25 basis points in the meeting scheduled on Tuesday, March 19.

It was in January that the RBI had cut its key lending rate by 25 basis points after a gap of 9 months. A rate cut would only help handling the crisis. With the govt all geared up to reduce the country’s fiscal deficit, more RBI rate cuts are probable in the forthcoming months.

Nifty and Sensex showed improvement after the Feb WPI report came and the main contributors were banking stocks!

Sensex and Nifty Performance in the New Year

It is the beginning of a New Year and investors have great hopes from the year 2013. A positive market upbeat prevailed with both the indices of the Indian bourses, i.e. the Sensex and nifty trending for the third day at a stretch. Thanks to hopes of a rate cut by the RBI later this month plus better than expected quarterly earnings, and US ‘fiscal cliff’ negotiations (problems getting postponed, not solved) benefiting global markets.

As projected by market analysts, the year 2013 would no wonder be full of surprises. The year 2012 saw a 25.7 percent gain in the benchmark index. It is to wait and watch! And you never know what the markets have in store. Amid volatility if the sensex and Nifty are trending today, a downtrend is certain soon. Unless government measures are implemented and interest rates paraphernalia be resolved by the central bank, economical growth would be a far fetched affair.

Unpredictable Nifty's U-Turn!

With UPA winning the FDI vote in Lok Sabha, stock market experts and traders had predicted that Nifty should breach the 6000 level on Thursday December 6. However, Nifty took a U-Turn and opened 43 points low in the opening trade at 5857.

IT shares and profit booking were the main reasons hurting the Market; Infosys, TCS pulled market down after their shares fell 2.1% and 2% respectively. Shares of retail firms Pantaloon and Shopper's stop gained in the early trading session to fall later. Pantaloon had gained substantially after the Bill to allow FDI in retail was passed and it was the top traded stock in early trade.

Market stayed volatile through the day with Nifty hovering below 5870 mark. Experts had expected Nifty to scale up as the Govt's win indicates a boost to the reforms and market sentiment. Despite given political positivity, Nifty failed to scale up and once again proved that Nifty is Unpredictable and  a trader should take Market volatility in stride!

BSE sensex, nifty, and the rupee uptrend!

The Friday NSE nifty and BSE sensex performance saw a boost amid much anticipation. Thanks to global influence! Hopes of implementation of economic reforms in Spain for managing of debt imbalances have led to this uptrend. It was the IT market that showed the highest price rise dynamics, given the fact about Spain outsourcing IT services from India. While the BSE sensex rose 183.24 points to close at 18,762.74, the nifty added 53.80 points climbing to the 5,700 level.

Markets also showed a positive upbeat with the rupee rising to a near five-month high on Friday (28 September). Thanks to improvement of global risks sentiment. Further signs of economic discipline are being shown as a result of the same with the government sticking to its original borrowing plan. An amount of 2 trillion rupees is estimated to be borrowed for October-March. Fast tracking of fiscal and economic reforms by the government has indeed increased the value of the rupee.