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| GDP, global cues to drive Dalal Street movement: Analysts |
| Press Trust of India / New Delhi Aug 29, 2010, 15:11 IST |
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The pace of GDP expansion in the Indian economy and cues from global markets will set the tone on Dalal Street this week, analysts said.
Investors will have their eyes on the gross domestic product (GDP) growth numbers for the first quarter of 2010- 2011, to be released on Tuesday, the marketmen said.
A strong close on Wall Street and European bourses at the onset of the weekend will be a positive trigger for the domestic market on Monday, but the overall sentiment is likely to remain weak, they added.
"The expansion in the economy is expected to match up the growth of 8.6 per cent seen in the last quarter of the fiscal 2009-2010," according to domestic brokerage house SMC.
As per data released on Friday, US GDP growth in the June quarter was slightly lower than in the previous quarter, but was still better than expected. The world's biggest economy expanded by 1.6 per cent during the June quarter, which helped Wall Street to notch up significant gains.
"Gaining strength from positive global cues, local stock markets are expected to open in the green on Monday," Bonanza Portfolio Vice-President (Research-Equity) Avinash Gupta said.
Though the overall sentiment is likely to remain weak, stock-specific action will assume prominence in market movements, analysts predict.
"Stock-specific activity, specifically in auto and cement stocks may not be ruled out, as companies would be reporting monthly production numbers this week," he added.
"The markets had been moving within a broad range for quite sometime, with choppy movements. The overall sentiment is likely to remain weak," brokerage house ICICIDirect said.
In a note on emerging markets, Barclays Capital said, "We continue to anticipate a broad range-trading environment and expect EM asset markets to respond to volatile global markets calmly, if not defensively."
In addition, the release of eurozone GDP and US housing data next week will guide the movement in global markets, analysts added.
Global equity markets, as well as the Indian market, fell during the week gone by after a record plunge in US home sales and slowing export growth in Japan raised concerns that developed economies are losing momentum.
On a week-on-week basis, the BSE Sensex lost 403 points, or 2.2 per cent, to close at 17,998.41.
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