Bulls signal hope for retail investors
There could be hope for the retail investors yet. A turnaround in the Indian and global stock markets may mean that liquidity could be on its way back, provided crude prices maintain a sustained downtrend.business Updated: Jul 17, 2008 21:54 IST
There could be hope for the retail investors yet. A turnaround in the Indian and global stock markets may mean that liquidity could be on its way back, provided crude prices maintain a sustained downtrend.
With crude prices falling for the second day in a row, the benchmark BSE Sensex closed up 536.05 points at 13111.85 on Thursday.
“This is primarily due to a sentiment change after the fall in crude oil prices yesterday,” said Dinesh Thakkar, MD, Angel Broking. “My opinion is that we are somewhere close to a bottom on the BSE Sensex, and could see a phase of consolidation from here.”
“Investors were back in action after crude prices fell for the second consecutive day,” said Ramdeo Agarwal, co-founder, Motilal Oswal Securities. “Everyone including the foreign institutional investors is closely watching crude prices. Sustained fall in oil prices would strengthen the currency apart from arresting inflation and boosting corporate profits. So, this comes as a much-needed breather for a battered market.”
Oil tumbled Wednesday, putting prices on track for a dizzying drop of more than $10 in just two days of trading on the New York Mercantile Exchange. This could mean fresh liquidity flows into India, said a dealer with a Mumbai-based trading agency. Light, sweet crude for August delivery was down $4.27 at $134.47 a barrel shortly before floor trading closed on the NYMEX, after earlier sinking as low as $132.
There are however, concerns about the effect of inflation on corporate earnings in India. However, moderate inflation figures published late on Thursday could mean better than expected results for Indian manufacturing sector, said the dealer source.