Weak IIP nos not to impact mkts: Amit Dalal

Amit Dalal of Amit Nalin Securities does not expect a weak IIP numbers to affect the markets too much as these have already been factored in by the markets.
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Dec 15, 2008, 02.10 PM | Source: CNBC-TV18

Weak IIP nos not to impact mkts: Amit Dalal

Amit Dalal of Amit Nalin Securities does not expect a weak IIP numbers to affect the markets too much as these have already been factored in by the markets.

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Weak IIP nos not to impact mkts: Amit Dalal

Amit Dalal of Amit Nalin Securities does not expect a weak IIP numbers to affect the markets too much as these have already been factored in by the markets.

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Amit Dalal , Amit Nalin Securities
Amit Dalal of Amit Nalin Securities does not expect a weak IIP numbers to affect the markets too much as these have already been factored in by the markets. He said the Indian markets would take cues from the global markets as they have tanked due to the auto bailout plan having failed in the US senate.

Here is a verbatim transcript of the exclusive interview with Amit Dalal on CNBC-TV18. Also watch the accompanying video.

Q: Where are we taking our cues from today?

A: We are definitely going to take cues from the global markets, the Asian markets have completely tanked because of the auto bailout which has been negated by their senate due to their negotiations going bad with the Unions of the Automakers, is going to be a big drag on the Dow for a few trading sessions. So, our markets are definitely going to open weak today.

Q: Do you think the auto package is completely out of the window or do you think there is still some bit of hope?

A: Like every other package which is need, I think it is a matter of negotiation. On the one side you have the extreme view of the government which says that the labour costs should come down to the cost of the Japanese workers and obviously the US autoworkers cannot go down to those levels. As there are uncertainties and time elapsed in this negotiation, it obviously will play on the markets and the Dow will have to take that into consideration.

 

Q: Has the market priced in a weak Index of Industrial Production (IIP) number or do you think if we get something far below market expectations, we might see a bit of a reaction to it?

 

A: I think these numbers have now perhaps taken into consideration the weak IIP numbers. Stock prices have fallen over the last month or two. In October certain plants had closed down, there was some complete breakdown in global trade and global financing. So I don’t think the market will now discount these factors and in a weak market like we have today there maybe some effect can come in. Inflation numbers, IIP numbers, are taken to be on a lower trend and will remain like that. So I don’t think that is such a big concern right now. 

 

Q: Will the auto bailout package failure make any deep impact across global markets?

A: I would like to say this in two ways. One is that we definitely have correlation to the global price movements of indices and once the US markets go down, Asian markets go down and we will have some reaction on that. In terms of where our markets can be impacted — I think if we have a range which is established right now and we see quite a lot of strength when the market is between 2,600-2,700 or 2,650-2,750 then there is certain amount of confidence building taking place. I would be very happy if that range remains intact for a 15 day period because otherwise every time the markets go up more and more people come in and the market would be thrashed down again.

 

Given the global scenario and we have a lackluster market for another 5-7 days and it will remain in a low range, I think that is perfectly alright for Indian market per se.

 

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Weak IIP nos not to impact mkts: Amit Dalal

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