The difficulties seem to take a back seat as the market is slated to open in the green. US stocks took off well after a President’s Day break following better-than-expected quarterly results from Merck and Barclays. Commodity prices and shares got a boost from a weaker dollar.
A kind of suspense continues on the outcome of the budget which is keeping investors on tenterhooks. With LIC expecting to invest further ~Rs100bn in the equity markets by March-end, many hope to quickly ride past the 5000 mark around budget time.
The Dow Jones rose 170 points, its biggest daily gain since Nov. 9 ‘09. The S&P 500 was up 1.8% while the Nasdaq added 1.4%. Asian markets are all up ~2%.
With most of the major Asian markets back with a bang we expect a solid start. However, one must not forget possibilities of a partial and calibrated rollback of the fiscal stimulus. Another daunting task for the government is to cap inflation which is on the verge of crossing double digit.
