It has been a bearish week for the Indian market with the Nifty marking the biggest weekly loss in near-Four Years. The market marked loss in four out of five trading sessions, with Nifty and Sensex losing over 4% at the end. Amid Global Concerns, the traders and investors are beginning to have a very bearish overview of the market. With the fears of slowdown in China, along with negative cues all over the Indices are hover around their psychological levels of 7700 for Nifty and 25,250 for Sensex. Bank Nifty fell 6.3% today to close at 16129. CNX PSU fell 8.7%. It is currently at the level of 2920. CNX AUTO closed at 7559 after losing 5.78% this week.
Jim Rogers Exits India– Jim Rogers, a very successful hedge fund manager, has sold his holdings in Indian equities because, he believes that the Modi government has failed to live up to investors’ expectations. He said,“I am sure Modi is a smart guy, he enjoys good press, and he makes a lot of friends for India. But I, as an investor, after almost a year-and-a-half, have decided to move on to other places, partly also because stock markets are not going to be particularly good for the next year or two,”
Kharif crop may be hit due to weak rainfall – The prospect of lower foodgrain production for the Kharif season has increased due to weak rainfall. The monsoon has been deficient by 11% in August recording 22% less than normal rainfall.Though June witnessed excess precipitation of 16%, while there was a monsoon deficit of 16% in July and IMD had predicted around 16% deficient rainfall during August and September.
Government has decided to invest Rs 8.5 lakh crore in Indian Railways– The Government has decided to invest Rs 8.5 crore in railways focusing on infrastructural development in order to boost growth. “After a decade of chronic under investment in Indian Railways we have decided we will invest Rs 8.5 lakh crore in Indian railways alone. This is extraordinary and will change the face of railways in India,” said Jayant Sinha, Minister of State for Finance. The government has also has doubled the investment in roads this year.
India’s Q1 Gross Domestic Product (GDP) expected at 7.5% but Gross Value Added (GVA) may fall to 6.7% – India’s first quarter GDP is expected to come at 7.5% vis-a-vis 6.7% year ago while GVA is expected to fall to 6.7% from 7.4% in the Q1 of previous year. Taxes are added while subsidies are subtracted from GVA to get GDP. The increase in GDP is due to marginal fall in subsidy and increases in taxes but GVA is lower due to poor Agricultural performance. So, services will limp along fine but industry as indicated by poor IIP data, and agriculture will take the number down.
Gold has been falling on strong US data– The Gold after a recent seven week high on fear of slowing Chinese economy, came down and stuck near its recent lows on friday and may further fall due to strong US economic data. There was an upward revision in US economic growth in second quarter to 3.7% from its initial estimate of 2.3% which has increased the expectation that federal reserve may hike interest rate this year despite the market turmoil. Gold after hitting seven week high on August 21 has cracked more than 3% since then. The upward revision in GDP along with strong housing and manufacturing data might drag the gold further downward.
