Just when the sentiment on the Indian bourses was improving we have been hit hard by a swift and steep spike in crude oil amid worsening Middle-East turmoil. The crude shock has triggered fears of further uptick in inflation and interest rates. A bloated oil import bill also hits India’s external balance sheet and fiscal health.
And on Thursday, it almost seemed like the expiry of optimism with the key indices taking a huge pounding. But, we are likely to see a better opening as crude has cooled off slightly and there hasn’t been any fresh selloff in global equities. We might see a positive end to a tumultuous week, provided there are no further nasty surprises.
At least for the day and for a few more days, investors will have to pay close attention to the Railway Budget, Economic Survey and the Union Budget. Let's hope the Railway Minister’s proposals for FY12 will keep things on track for the local bourses.
The overall undertone may continue to be a little nervous, and so one needs to be very watchful before jumping the gun.
