Apprehensions again!

Better be despised for too anxious apprehensions, than ruined by too confident security. - Edmund Burke.

Stocks are set to drop anew as a global selloff worsens amid worries about slowing economic growth. After the disappointing US jobs report and Chinese data, the bad news now emanates from Europe. Stocks in Italy and Spain crashed, as a sharp rise in borrowing costs revived concerns about the region’s sovereign debt crisis. A sharp fall in Italian and Spanish equities dragged down European and US markets. Asian markets too are jittery this morning.

In a rare development, Greek stocks jumped after the country raised €1.3bn from six-month T-bills. Also, nearly all Greek bondholders have agreed to restructure debt. Alcoa has posted a surprise profit for the latest quarter. Separately, OECD’s leading indicator of economic activity shows signs of improvement across all major economies.



For India the bad news continues in the form of FII selling due to the GAAR imbroglio. Rising twin deficits, high oil prices and sticky inflation are not helping either. IIP data is due on Thursday while inflation will be released on Friday. Infosys results are slated for Friday as well. RBI’s policy meeting will be the important event next week.

Trend in FII flows: The FIIs were net sellers of Rs 3.28bn in the cash segment on Tuesday while the domestic institutional investors (DIIs) were net sellers of ~Rs 1.9bn, as per the provisional figures released by the NSE.

The FIIs were net sellers of Rs 4.39bn in the F&O segment on Tuesday, according to the provisional NSE data.

The foreign funds were net sellers at Rs 2.52bn in the cash segment on Monday, according to the SEBI figures. Mutual Funds were net sellers of Rs 2.06bn on the same day.

Global Data Watch today: Japan core machinery orders, Australia Westpac consumer confidence, Germany WPI, US import price index and Fed's Beige book survey.