www.rupeedesk.in
Bank stocks are likely to consolidate next week, after the recent rally in stocks of both
public sector and private banks, and are seen moving in a narrow range. Movement in
bank stock is rangebound also because you have policy coming up. So even with better
WPI (Wholesale Price Index-based inflation) numbers, markets are expecting status quo
in the policy review as the RBI is focusing on CPI (Consumer Price Index). The Reserve
Bank of India is scheduled to detail its bi-monthly monetary policy on Apr 1. Data
released yesterday showed India's WPI inflation for February eased to a nine-month low
of 4.68% from 5.05% in January, primarily on account of a decline in prices of food
articles, especially vegetables.
Investors will keenly eye the US Federal Open Market Committee's meeting scheduled
for Mar 18-19, with the central bank expected to further taper its monthly asset
purchases. Despite the recent surge in stock prices, investors remained cautious, given the
issue of worsening asset quality. Our overall stance on the banking sector remains
cautious, as we believe the macroeconomic demand slowdown that India is experiencing
is unlikely to witness a sudden turnaround, despite a likely stable and decisive
government.
Bank stocks are likely to consolidate next week, after the recent rally in stocks of both
public sector and private banks, and are seen moving in a narrow range. Movement in
bank stock is rangebound also because you have policy coming up. So even with better
WPI (Wholesale Price Index-based inflation) numbers, markets are expecting status quo
in the policy review as the RBI is focusing on CPI (Consumer Price Index). The Reserve
Bank of India is scheduled to detail its bi-monthly monetary policy on Apr 1. Data
released yesterday showed India's WPI inflation for February eased to a nine-month low
of 4.68% from 5.05% in January, primarily on account of a decline in prices of food
articles, especially vegetables.
Investors will keenly eye the US Federal Open Market Committee's meeting scheduled
for Mar 18-19, with the central bank expected to further taper its monthly asset
purchases. Despite the recent surge in stock prices, investors remained cautious, given the
issue of worsening asset quality. Our overall stance on the banking sector remains
cautious, as we believe the macroeconomic demand slowdown that India is experiencing
is unlikely to witness a sudden turnaround, despite a likely stable and decisive
government.
