New Delhi: Markets are likely to slide further next week as third quarter earning numbers of corporate are unlikely to bring any “great surprises” to Dalal Street, experts said.
Stock markets have witnessed an extremely disappointing start to the year 2011, as the bellwether Sensex has plummeted over 8% in the first two weeks of the year.
Market analsyst feel that the testing time is still not over for the Dalal Street with rising inflation playing a major spoilt sport.
“After a really bad start to 2011, one would have thought there will be some bounce back. But weaker than expected IIP data coupled with the rise in inflation were the main culprits this week.
Clearly, the Indian economy is confronting a few headwinds as of now and one needs to be careful in the near term before there is more clarity,” IIFL head of research Amar Ambani said.
The new week will start with the result of the software giant Tata Consultancy Services, which will post its December quarter earnings on 17 January, followed by the rival player Wipro and the country’s most valued firm Reliance Industries third quarter numbers on 21 January.
But the analysts feel that after a subdued performance from the IT bellwether Infosys Technologies, street is not expecting much from these corporate honchos.
“Market which is grappling from weak overseas inflows and interest rate hike concerns in view of rising inflation is unlikely to trade higher in the coming week also.
The bourses were spooked by the Infosys lower-than-expected numbers and are not expecting much from the other biggies as well as the last quarter has been challenging for the corporates,” Unicon Financial Services CEO Gajendra Nagpal said.
Experts also pointed out that immediate concerns are far more serious for the markets than the country’s long-term growth story which is intact.
“The medium to long-term structural India growth story is intact. The relative growth potential and the demographic opportunity, which India provides will attract investors,” Kotak Mahindra Old Mutual Life Insurance Chief Investment Officer Sudhakar Shanbhag said.
But, news regarding earnings, RBI policy stance and the ensuing budget will be closely watched, Shanbhag added.