Global events will point the way forward for Indian equities

Market may remain volatile next week as investors shun risky assets as political events unfold in Europe, especially in debt-burdened Greece and Italy. Redemption pressure for foreign funds in developed markets will result in forced selling of Indian stocks by foreign institutional investors. Admittedly, investors are jittery and prone to hit the sell button at the slightest sign of trouble.

India needs to guard against imported inflationary pressure as the euro-zone continues to reel under the debt crisis, Prime Minister Manmohan Singh had said on 2 November 2011. "In an increasingly interdependent world, we have to be wary of contagion effects," Singh had said in a statement early this month before his departure to attend a conference of the Group of 20 industrial and developing economies in Cannes, France.



Investors will closely watch data on inflation based on the wholesale price index (WPI) for the month of October 2011 due on Monday, 14 November 2011. WPI inflation stood at 9.72% in September 2011. The food price index rose 12.21%, its highest in 9 months, and the fuel price index climbed 14.50% in the year to 22 October 2011, government data on 3 November 2011, showed. In the previous week, annual food and fuel inflation stood at 11.43% and 14.70% respectively. The primary articles price index was up 12.08% compared with an annual rise of 11.75% a week earlier.

The earnings season is drawing to a close. Select firms are yet to announce their earnings next week. Investors will closely watch the management commentary at the time of announcement of Q2 September 2011 results, which will provide cues on futures earnings outlook. Coal India, Nalco, Shipping Corporation of India and Reliance Communications will announce their June-September 2011 quarter results on 12 November 2011. LIC Housing Finance and Sun Pharmaceutical Industries will announce their June-September 2011 results on 13 November 2011.

Bhel, Cipla, Jaiprakash Associates, Mahindra and Mahindra, Tata Motors, Tata Power Company, Oil India, Bhushan Steel, JSW Steel and India Cements and Unitech will announce their June-September 2011 results on 14 November 2011. Tech Mahindra will announce its June-September 2011 results on 15 November 2011.