Macro economic outlook of India

As per the early economic indications there was a strong sentiment in Indian stock market in favour of the bulls. It was expected that the 1stweek of the new year will show signs of buying while all the hopes of investors broke all on a sudden when last Friday saw a kind of gruesome carnage with major indices falling ruthlessly leaving the market badly beaten up. 7thDec 2011 may be rightly called as a black Friday as the market recorded the biggest percentage fall on almost all indices and the carnage on the Dalalstreet is due to worrisome 18% inflation, fear of rate hikes by central bank later this month and the oil price hike. Experts believe that the year is tricky and investors need to cautious while some also believe that after this heavy fall it may be a good time for buying activities to pick up in sector specific stocks. Exports witnessed a growth of 36.4% while fiscal consolidation may trigger hope while inflation needs to be checked.

Fearful exit of FIIS is one of the major reasons behind the free fall on Friday while this fall may have given a ground for further opportunity to buy from this point as the other major markets like US and Europe are still under uncertainty Asian markets reamin as a good option for buying. Macro economic outlook of India is still in a good state while any attempt to reduce the current account deficit, oil price and inflation is a welcome step to build investor confidence.

By Dipti Prasad Padhi 

By : | Category : Business and Economy| Date : November 10,2011

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