Market may be irrational but after a stormy week and a strong pull-back on Friday, we are in for some bit of stability. Equities and commodities worldwide have recovered after a brief rout, which was led by concerns of a slowdown in the US and China.
The commodities market will remain in focus for a while as investors digest the latest economic statistics from the world’s top two economies. Incidentally, leaders from the US and China are meeting in Washington this week to discuss major economic issues.
For India as well as for the world economy, any relief on the energy front is good news. So, the steep fall in oil prices is more than welcome.
The start today will be positive. Asian markets are on firm footing. US stocks closed higher in the wake of an encouraging jobs report. But all three US indices came off the day’s highs. European stocks had a very good session.
There might be some more recovery led by short-covering. But, the advance may not sustain for long unless FII flows turn positive. For the week, markets will keep a close eye on the IIP data and the outcome of the assembly polls.
