Onions and other veggies are making headlines for hitting the household budgets and adding to the UPA’s woes. Food inflation, which seemed to be softening, has surged to 12%. It could spike further up if the Government goes ahead with a hike in diesel and LPG. Crude oil is hovering around $91.51, amid optimism that the US economy is slowly getting back on track.
Meanwhile, the Indian markets seem to be suffering from the holiday syndrome, completely lacking excitement. December has been utterly forgettable for India even as “western” markets are enjoying a Santa Clause rally.
FIIs and other influential institutions have been on the sidelines, leading to a listless trend. We expect a slightly lower start and rangebound movement for the key indices.
Next week, there could be some action owing to the F&O expiry, but don’t bet on any significant progress. January will be interesting as markets react to the latest report card from India Inc. and the RBI review.
