Economy Feb 20, 2012
Hong Kong: After a night without end that marks Mahashivratri, Indian markets are closed for the day. But this is one of those days when it would have been eminently rewarding to trade.
Asian markets are on fire this morning, after China lowered its reserve requirement ratio, freeing up liquidity, on Saturday, and news out of Europe signalled that Greece was on course to receive a round of bailout funds.
As at 7.30 am IST, indices across the Asia-Pacific region are up strongly, in excess of 1 percent across the board, with Tokyo's Nikkei index doing particularly well on the back of a weaker yen, which is good news for exporters.
Nifty futures are also trading up by a healthy margin, and are within kissing distance of the 5,700 mark. And although they've since come off that high at the start, they're still considerably ahead of the game, and if the Indian market had been open today, that would have meant a bullish start to the day's trade.
As it is, analysts are looking ahead to the week and expecting a bit of profit-taking to seep in, given the surge in equities since the start of the new year. But given that the European Cental Bank is pumping liquidity in large volumes, there's a fair chance that a lot of that will wash up on Indian shores. The only downside risk in India in the medium term is a budget that dampens investor sentiments, but I've argued earlier that I expect that we'll likely see a reformist budget that cheers the markets.
Analysts at Barclays also see scope for rate cuts beginning March, and foreign institutional investor interest in India remains robust.
There's a fair chance that today's exuberance in the markets could continue into today, when the Indian markets are back in business. But given the extreme volatility that we're witnessing from day to day, there's no certainty about anything. For today, Indian investors can only draw vicarious joy from seeing global markets soar, and ponder wistfully on what might have been if the Indian markets had been open today.
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