Weekly Newsletter - Aug 15 2011

It promised to be a terrible week and started really badly, as investors scurried for cover in the wake of the US downgrade by S&P. But by the time the tumultuous week wound down the losses for the key Indian indices didn’t seem so horrific. Even the world markets recovered from the initial jolt, with investors snapping up beaten down stocks. However, volatility skyrocketed with stock indices gyrating throughout the week.



Although some of the dust on the S&P’s shocker seems to be settling, it will still take a while for markets to fully recover. There could be some more short-term pain depending on the global data points and other developments. So, curb your animal spirits for the time being and wait for some more clarity.

For India, the key factor will be how the fund flows shape up and what further steps the Government takes to protect the long-term growth story. Next week will be truncated one due to the Independence Day. Monthly inflation data, Q2 GDP report and F&O expiry will be among the near-term events to keep an eye on.