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Sensex lower, Nifty breaks 8750; rupee gains past 67/$

The rupee gained past 67 against the US dollar, rising 0.31 percent to trade at 66.98, for the first time since November 11, 2016, on consistent selling of the American currency by exporters and banks.

February 09, 2017 / 12:45 IST
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Moneycontrol Bureau12:40 pm FII View: Bharat Iyer of JPMorgan says it appears that the easing cycle may have ended, especially after monetary policy announced on February 8.

Market expectations of a 25 bps rate cut were belied but more importantly, the Monetary Policy Committee changed the monetary policy stance from accommodative to neutral, focusing on output gaps and inflation targeting, he adds.

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Historically, equity markets have rallied considerably post bottoming of the rate cycle. The current event calendar suggests that positive news, particularly on the policy front, could now thin out over the next two months, according to him.

Iyer feels technical and momentum indicators also appear a tad stretched. Consequently, he expects a phase of consolidation in the equity markets near term.