Today, after Monday Mayhem came Tuesday Turnaround, now Wednesday what? Don’t get perturbed by such high volatility. Remember, we have covered a long distance from early March. Some consolidation after a reasonably protracted advance is a given. Brace for wild swings as most global economies will witness a slow recovery. The same holds true for India, especially now that the monsoon has failed to live up to expectations.
Interest rates and inflation could also play spoilsport going ahead. Overall though, India should do reasonably well with no other concerns on the horizon.
Given the mixed global cues, particularly from Asian markets, we expect a cautious opening and a choppy day. Most world equity markets recently touched multi-month highs before softening a little. The catalyst for that sharp rally was growing optimism that we are out of the woods and are on the road to recovery. IMF’s top economist Olivier Blanchard also endorses this view, but warns that the recovery won't be typical. The short point is one should not expect very high growth rates and a swift recovery.
