EVERYONE GETS WHAT THEY WANT!

Indian Polity works in a measurable manner and if possible by consensus except in cases where the circumstances are dire enough to call for strict action.

Abysmally low expectations from the Budget were very clear when the Traditional Pre-Budget Rally was given a miss by the market in the beginning of February.

The common man was given a pleasant surprise by bringing down his personal tax outflow and providing one more avenue to him to save tax.

The FM laid his roadmap to bring down the fiscal deficit to 4.1% over the next three years( 5.5% FY11, 4.8% FY12, 4.1% FY13 ). These numbers if achieved, even after accounting for some slippage, it would be a significant achievement.

There is a lower allocation for the Petroleum Sector suggesting that government is not expecting subsidy payments to be high based on the assumption that crude prices will be soft and implementation of the Kirit Parikh committee report shifting the burden to customers.

Inflation could take time to come down with the rollback of excise duty from 8% to 10% and rise in excise duty on petro products.A normal monsoon this year hence becomes very important.


MARKETS IN THE COMING WEEK
Given the positive global cues yesterday, it looks like we shall have a good start to the week. The market was up on good volumes after a long time. It augurs well for bulls atleast for the short term.

We did come very close to the 50% retracement level of this fall on Friday and one more attempt to conquer that level looks very probable.However, the Sensex range 16650-16950 should be used to trim positions in which investors are stuck.For Nifty the corresponding levels are 5030 and 5100.


The midcaps which were beaten badly are expected to bounce back till the market peaks out on the above mentioned levels.


Have a great trading day,


Regards,
Rahul T.