The week that went by-
This week the benchmark BSE Sensex and the NIFTY 50 opened at 36,194.30 and 10876.75 respectively. The markets bled heavily and gave negative returns. Nifty lost 250 points in 4 days, only to see some recovery on the last day. This all happened, despite low crude prices and a positive RBI’s monetary policy which maintained a status quo on rate hike and an assurance on sufficient liquidity in the markets for the coming months. Let us quickly rewind all the major happenings of the week:
Auto Sales Numbers:
Two wheelers sales up 26 percent to 3.06 lakh units.
Scooter sales up 43 percent to 1.11 lakh units.
Motorcycle sales up 29 percent to 1.19 lakh units.
Exports sales up 24 percent to 58,476 units.
Three-wheeler sales up 48 percent to 8,642 units.
M&M and Ashok Leyland bore the brunt of the market, owing to lower sale numbers and have declined heavily, while TVS emerged as a winner.
RBI Maintained Status Quo:
As predicted, the banking regulator maintained its stance on monetary policy, which is a welcome move. The lead banker stated a decline in CPI inflation as a positive sign and 31% decline in crude oil prices very positive for Indian Economy. But RBI left a warning note of staying alert for any sharp reversal in prices.
Apparently, despite all the positives, it was the political uncertainty which took a toll on the market. There are 5 states, for whom the election result is to be declared on 11th Dec. This has kept the entire market on its heels and traders have mostly stayed aloof of taking deliveries.
Qatar pulled itself out of the grouping. While it is not expected to impact the crude prices, as Qatar is a major player in natural gas. The decision to reduce production by the
The arrest of CFO of Huawei
The problems according to trade experts stem from both international and domestic factors, the escalating trade war between the USA and China with the arrest of Meng Wanzhou CFO of Chinese mobile giant Huawei on the international front. This has again made the prospects of a deepening trade war fairly visible. Chinese market nosedived as a result. One should not be surprised if market witness some deep cuts on Monday. Investors are advised to stay composed and play with strict stop losses.
Markets have been extremely volatile for the last month and experts believe that it will remain so in the coming months as well. Big Investors, it seems will wait and watch how the trade war between USA and China play out, retaliatory action by China if any. The impact of production cut will decide the market’s movement in the coming week as well.
By Akshay Gupta