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D-street may come under pressure this week: Analysts

D-street may come under pressure this week: Analysts
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First Published: Sun, Jul 27 2008. 03 12 PM IST
Updated: Sun, Jul 27 2008. 03 12 PM IST
PTI
Mumbai: The markets are expected to come under pressure on rumours that the Dalal Street would be the next terror target after a series of bomb blasts in Bangalore, the IT hub of the country, and later in Ahmedabad last week, analysts said.
“The sentiments may remain subdued and cautious after the serial blasts in Bangalore and Ahmedabad and on rumours that the Dalal Street may be the next terror target,” a market observer said.
Last week on 25 July, tremors of the Bangalore serial blasts were felt in Bombay Stock Exchange with the benchmark Sensex tumbling by over 500 points as suspected terror-link to the explosions in the country’s IT capital added to selling pressure.
The fall of 502.07 points, coupled with another 165-point plunge a day before, wiped off close to one-third of gains of the five-day rally, that started on 16 July, from the Sensex.
Analysts believe volatility in the equity market would continue as the global situation has improved and there has been a continuous fall in the global crude oil prices from the last two weeks.
“Market are likely to remain volatile this week, amid the quarterly review meeting of the RBI, F&O settlement and the mixed trend of the corporate earnings, ” Taurus Mutual Fund director R K Gupta said.
Besides, analysts expect the Reserve Bank to raise the Cash Reserve Ratio (CRR) by up to 50 basis points, which could again put pressure on banking and other interest rate related sectors like realty.
Meanwhile, volatility may remain high ahead of the expiry of Futures and Options contracts for July, 2008 series on July 31, analysts said.
The BSE benchmark index Sensex gained about 500 points in the last week to close at 14,274.94 points.
This gain can largely be attributed to the victory of the Congress-led coalition government in the confidence vote in Parliament, sharp correction in crude oil and short covering of derivatives positions.
Besides, inflation for the first time since May, eased to touch 11.89% during the week ended July 12 from 11.91% in the previous week, mainly due to moderation in prices of certain food items like sea fish, tea and imported edible oils.
A host of companies including PSU major ONGC, L&T, Glenmark Pharma, HDFC Bank, Britannia Industries, Dabur India, Wockhardt and Hindalco are scheduled to announce their first quarter results this week.
The Sensex tumbled by 503 points and settled at 14,274.94 points on 25 July, while the 50-share Nifty had settled down 121.7 points at 4,311.85.
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First Published: Sun, Jul 27 2008. 03 12 PM IST
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