Weekly Newsletter - Oct 15 2010

The big story for the coming week will of course be the mega Coal India IPO which opens on Monday. Meanwhile, the volatile consolidation phase continues in the Indian market. Investors seem to be treading cautiously given that we are in the midst of the earnings season. Also, some cooling was expected as last month's rally had left the market a little overheated. So, after five straight weeks of advance, which lifted the key indices near their all-time highs, we have seen a minor pullback over the last two weeks. Still, the bulls almost pulled off new highs in the middle of this week when the Sensex soared by nearly 500 points only to retreat in the next two sessions.



After this week's volatility people are bound to be a little jittery about the near-term prospects for the market. And, there are no easy answers as results will continue to trickle in. At the same time, the anxiety over the fragile external scenario will keep the market players on tenterhooks. The heightened action in the global currency markets and the verbal feud over the sticky issue could also weigh on the sentiment. Fed chief Ben S. Bernanke says he is ready to ease the monetary stance further but will be cautious in unleashing Quantitative Easing 2.

All eyes are now on the next FOMC meeting, which is slated for Nov. 3. US will also hold congressional elections around the same time. Back home, the RBI policy meeting is scheduled for Nov. 2. Before that there will be a G20 summit in South Korea on Oct. 22-23.

Among the top results next week include Sesa Goa, HDFC, L&T, Bajaj Finserv, ING Vysya Bank, Mindtree, Bajaj Auto, Concor, HDFC Bank, Ashok Leyland, Persistent Systems, GSFC, Ambuja Cement, SKF India, Allahabad Bank, South Indian Bank, Mahindra Forgings, TVS Motor, Sasken, Zensar Tech, ACC, Eclerx, M&M Financial, Chennai Petro, Ipca Labs and Biocon.

Lots of global data points will be on tap as well. In the US, a slew of housing sector reports will be released apart from statistics on industrial production, Fed's Beige Book survey, weekly jobless claims, leading economic indicators and the Philly Fed index. Germany will announce ZEW survey of Economic Sentiment and IFO business outlook. Minutes from the BOE and RBA's last policy meetings will also be issued, besides UK retail sales. China's Q3 GDP and September economic indicators will also be watched closely.