US markets are at the brink of Recession. There are multiple problems in the US. Like Housing led, over leveraged, falling asset prices and many more. Consumer confidence is at a multi decade lows. GDP may turn to negative. Recovery in the US markets are likely to be so fast. It will take a long time to coupe up with all the pains it has suffered. According to me in India i dont think so that the pain is as severe as in the US. Indian banks have very less leveraged levels. The US financial firms have over leveraged positions by around 30-40 times. RBI should come up with more CRR cut to have significant liquidity in the market. This in trun will help the cut in the intrest rate. Inflation rate have also cooled off from the recent high to 11.44% for this week.
As mentioned in the morning note that our markets will bounce back. Sensex after pluging down nearly 650 points in the open trades. For most of the day sensex remained at the same level, but rallied sharply in the closing hours as soon as the inflation data was released. Inflation for the weekend stood at 11.44%. Indian markets will take support at these levels. We may see some consolidation here. In the Extreme case sensex may fall down to 9500 levels, thats an extreme case , acc to me.
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