Falling gold prices will lower CAD by 5% of GDP: CLSA

Here are experts equity calls for the day on how the markets are expected to trade:

Neelkanth Mishra, Credit Suisse: The worrying expansion in India's CAD has been part of a global trend of demand switching to EMs. This does not make it less harmful, but does make it more sustainable. We are not as enthused by lower oil and gold prices as some. Market belief that this means a risk-on rally is premature, as the cause of these cuts is slowing growth. We prefer stocks with high interest cost but some EBIT stability like United Spirits or JP Associates or low P/E but defensive stocks like NTPC, Coal India & HCL Tech.

Mahesh Nandurkar, CLSA: Falling gold prices will lower India's current account deficit by 5 percent of GDP. Secondly, rising gold prices had driven the share of savings in gold in total household savings to double to 13 percent over the last 5 years and a potential trend reversal would imply greater savings in property and financial products .Thirdly, the negative impact on consumption should not be ignored. Obvious losers would be Titan, gold NBFCs and some small south India based banks.