The markets made gains early in the week and looked to consolidate towards the end. Technical indicators suggest that there could be a period of consolidation ahead with a slightly positive trend. However, the moving averages are all within a few points of each other and a correction could easily reverse the trend.
The IIP data released this week was negative and that has investors worried. These are confirmations that the economy is slowing down. However, inflation data is also on the higher side and the RBI has little room to bring down rates in the near term. The markets will therefore continue to remain range bound in the short to medium term.
Globally also the markets were in a period of consolidation. Europe still remains the main worry.
The Rupee closed the week at 55.28 to the dollar. It is expected to trade in the 54.8 to 56.3 range for the near term.
Gold also remained range bound as it remains tied to the dollar for the time being. At these levels gold looks a bit expensive to enter in to. Investors already holding gold can continue to hold it.
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