High volatility expected on D-Street on RBI move, G-20 summit

High volatility expected on D-Street on RBI move, G-20 summit
PTI
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First Published: Sun, Nov 16 2008. 03 47 PM IST
Updated: Sun, Nov 16 2008. 03 47 PM IST
Mumbai: Dalal Street is likely to witness heavy volatility this week, as although the Reserve Bank of India (RBI) has announced a slew of positive measures there were just promises from world leaders to wipe away the economic crisis, feel analysts.
“Amid the general negative bias in the market, D-street will take cues from the RBI’s steps and the G-20 summit. Accordingly though market may trade in the positive zone for some time but will eventually fall back in the red,” Kejriwal Research and Investment Services (KRIS) official Arun Kejriwal said.
RBI’s action can spell boon for realty and finance sectors but overall there exists a negative trend and as a result there will be heavy volatility, marketmen said.
“Volatility is extremely high across the world markets and till the uncertainty boils over, domestic markets are likely to continue on their downward journey. Stocks are oversold and awaiting a positive trigger to bounce back,” brokerage firm SMC Global Vice President Rajesh Jain said.
The benchmark index Sensex witnessed a highly volatile trade last week and settled down by nearly 2% at 9,385 points on Friday.
World leaders have warned that economic momentum is slowing substantially across the world and the global outlook has weakened. Leaders in the G-20 summit have agreed to initiate strong and significant actions to stimulate economies, bring transparency in financial system, offer liquidity and reform financial institutions to beat recession.
The summit also pledged to help emerging and developing economies gain access to finance.
Meanwhile, the RBI has announced a slew of measures, including permission to housing finance firms to raise funds from overseas markets and raising the interest rate ceiling on foreign currency deposits.
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First Published: Sun, Nov 16 2008. 03 47 PM IST