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India Week Ahead - 1st - 6th March 2010

|Includes: EEM, IBN, India Fund (IFN), INFY, TTM, WIT
The Indian markets was one of the few markets that went up this week by 1.5 % vs global markets which closed more or less flat to slightly - Ve. The Indian market went against the expectation of a fall, markets seem to have discounted the budget ahead of time so it closed close to the SL level of 4930 after hitting a high of 4980 levels. The budget did not have any major surprises, am surprised with the aggressive target of revenue growth next fiscal at 18 %, the FM claims this will reign in the deficit to 5.5 %. The math does not add up, a GDP growth of 7 - 8 % and a revenue addition of 18 % ? The Debt to GDP ratio is @ 54 %, this is another area of worry for the government, the government need to reign in this or can go out of control. Mind you, all this is without taking into account the state budgets / deficits ! Last week the US markets too was volatile with the consumer confidence coming lesser than expectation and a higher un employment rate.

This week the markets will go with global cues, the Indian markets have some big cash crunching situation coming in March, we have the advance tax payments by mid March, the pressure to shore up finances ahead of the financial closing will add to the pressure on the money & stock markets. On the global cues, the US manufacturing index & Greece debt issue will be in focus.

The derivatives position for the week stands at RsĀ 88000 Crs OI; the PCR is at 1.19 the option IVs for Calls at 22 % & Puts at 26%. The option data suggests, we will be in for a volatile session.

Nifty on 26th Feb.: 4922
For the week: Do not Trade.Upsides seem to be capped, trying to trade a volatile markets, will help the brokers make money on brokerage and you losing out. So stay out of trading this week.

Levels : 4820 - 4950, A break out may lead to direction.