Weekly Newsletter - May 8 2010

As if the recent turmoil and the consequent gyrations were not enough, next week promises to be equally dramatic and eventful. So, brace yourselves for another rollercoaster ride as the market will have to consider a spate of big developments. Those include: UK election results, Greek parliament vote on austerity measures, ECB commentary, US jobs data, RIL-RNRL outcome, IIP and Inflation. With so many potentially market moving events to digest, the key indices are likely to remain on tenterhooks. One also cannot ignore the fact that the rupee has been sliding and FIIs have been big sellers.

Given the uncertain and murky backdrop, especially on the external front, it would be wise not to take any major directional calls, at least in the near term. Looks like the European debt crisis may take a while to subside. In that case, the Indian market will swing to the beat of the global tune and witness intermittent bouts of buying and selling. It would be difficult to accurately call market's direction and thus making money will only get tougher. Keep cash handy as there is a chance of the market going through some more pain in the coming days. Buy only fundamentally-sound companies and be careful while picking stocks in the Small- and Mid-Cap universe.