Helping You Build Wealth With Honest Research
Since 1996. Try Now

MEMBER'S LOGIN

MEMBER'S LOGINX

     
Invalid Username / Password
   
     
   
     
 
Invalid Captcha
   
 
 
 
(Please do not use this option on a public machine)
 
     
 
 
 
  Sign Up | Forgot Password?  

RBI rate cut boosts sentiment
Tue, 17 Apr Closing

Indices in the Indian stock market were helped by a strong late buying surge and this enabled them to close the day on a very positive note. Thus, while BSE-Sensex edged higher by around 210 points (up 1.2%), gains on the NSE-Nifty came in at around 60 points. BSE Mid Cap and BSE Small Cap indices lagged slightly and edged higher by around 0.6% each. Only three stocks amongst the Sensex heavyweights ended the day on the losing side.

While Asian indices closed mixed today, Europe has opened on a positive note. The rupee was trading at Rs 51.5 to the dollar at the time of writing.

The Indian markets that were struggling to find a reason to break away from its lacklustre showing, finally got a big one in the form of RBI's rate cut announcement. However, investors assume this to be the panacea for all the ills affecting Indian economy at their own peril. A lot of structural issues need to be sorted out first in order for the lower interest rates to show their effect. Failing to do so would exacerbate the problem and all that the lower interest rate would end up doing is stoke fresh fires of inflation. Thus, buying solely on the basis of lower interest rate environment would be a big mistake we believe.

Looks like the IPO market is trying to get back on its feet. Latest to evince interest in getting itself listed is a well-known Mumbai based jewellery retailer, Tribhovandas Bhimji Zaveri. The firm is hoping to garner around Rs 2 bn from the capital market, part of which would be used to open new showrooms and the rest towards meeting working capital requirements. The company has decided to utilise the entire net proceeds during the fiscal year FY13. Presently, the company operates through 14 showrooms and eventually hopes to take this number to 44 by FY14.

Barely has the ink on the rate cut decision dried and State Bank of India (SBI), India's largest lender, has got down to business. As per reports, the state owned banking behemoth is planning to cut lending rates on loans that have high interest rates post the Reserve Bank of India (RBI) decision. This decision comes close on the heels of the bank revising its interest rates on retail term deposits by as much as 75 basis points to 100 basis points. The stock closed higher by more than 1% on the bourses today.

For information on how to pick stocks that have the potential to deliver big returns, download our special report now!

View all commentaries | Archives

Read the latest Market Commentary


Equitymaster requests your view! Post a comment on "RBI rate cut boosts sentiment". Click here!

  
ABOUT EQUITYMASTER

Since 1996, Equitymaster has been the source for honest and credible opinions on investing in India. With solid research and in-depth analysis Equitymaster is dedicated towards making its readers- smarter, more confident and richer every day. Here's why hundreds of thousands of readers spread across more than 70 countries Trust Equitymaster.

PREMIUM PRODUCTS
QUICK LINKS
POPULAR TOPICS
TRENDING TOPICS
FREE NEWSLETTERS
EQUITYMASTER SUPPORTS
  • HelpYourNGO
  • You Tube
  • Linkedin
  • Twitter
  • Telegram
  • Google Play

Copyright © Equitymaster Agora Research Private Limited.

Whitelist | Refer | Terms | Privacy | Contact | About | Sitemap

Phone +91-9136015013

Equitymaster Agora Research Private Limited (Research Analyst)
SEBI (Research Analysts) Regulations 2014, Registration No. INH000000537.

103, Regent Chambers, Above Status Restaurant, Nariman Point, Mumbai - 400 021. India.
Telephone: +91-22-61434055. Email: info@equitymaster.com. Website: www.equitymaster.com.
CIN:U74999MH2007PTC175407

Name of the Compliance & Grievance Officer: Ms Sonal Ramachandran
Telephone: +91-22-61434003 | Email: compliance@equitymaster.com

LEGAL DISCLAIMER:
Investment in securities market are subject to market risks. Read all the related documents carefully before investing.
Registration granted by SEBI and certification from NISM in no way guarantee performance of the intermediary or provide any assurance of returns to investors.

All rights reserved. Any act of copying, reproducing or distributing this newsletter whether wholly or in part, for any purpose without the permission of Equitymaster is strictly prohibited and shall be deemed to be copyright infringement.

Equitymaster Agora Research Private Limited (Research Analyst) bearing Registration No. INH000000537 (hereinafter referred as 'Equitymaster') is an independent equity research Company. Equitymaster is not an Investment Adviser. Information herein should be regarded as a resource only and should be used at one's own risk. This is not an offer to sell or solicitation to buy any securities and Equitymaster will not be liable for any losses incurred or investment(s) made or decisions taken/or not taken based on the information provided herein. Information contained herein does not constitute investment advice or a personal recommendation or take into account the particular investment objectives, financial situations, or needs of individual subscribers. Before acting on any recommendation, subscribers should consider whether it is suitable for their particular circumstances and, if necessary, seek an independent professional advice. This is not directed for access or use by anyone in a country, especially, USA, Canada or the European Union countries, where such use or access is unlawful or which may subject Equitymaster or its affiliates to any registration or licensing requirement. All content and information is provided on an 'As Is' basis by Equitymaster. Information herein is believed to be reliable but Equitymaster does not warrant its completeness or accuracy and expressly disclaims all warranties and conditions of any kind, whether express or implied. Equitymaster may hold shares in the company/ies discussed herein. As a condition to accessing Equitymaster content and website, you agree to our Terms and Conditions of Use, available here. The performance data quoted represents past performance and does not guarantee future results.