Well, just when the Indian market was looking like adding to the post-Budget gains comes yet another political jolt. The DMK has decided to pull out its ministers from the UPA II, ostensibly on differences over seat-sharing for the upcoming TN assembly polls. The DMK will offer issue-based support though. Whether a formal split with the Congress is in the offing or not remains to be seen. Policy impasse and governance (rather the lack of it) has been one of the factors behind the market’s recent fall. The latest development will add to the worries though political stability is not really a major concern.
We expect a nervous start though things could improve later on if the global markets resume their advance. Crude oil remains at uncomfortable levels amid deteriorating geopolitical situation in Libya and elsewhere in the Middle-East.
Intraday volatility is here to stay so stick to defensive plays. Be a patient buyer rather than buying soon and testing your patience.
