Experts unanimously hailed the Reserve Bank’s repo rate cut by 100 basis point as positive, but added that the impact on capital markets would not be much. Most experts felt that confidence in the market was low and decisions needed to be taken to counter short-selling and volatility.The RBI today cut the repo rate cut — the first since 2003 — in a bid to infuse liquidity into the system. (Read: RBI cuts repo rate) After the announcement, the Sensex rose about 500 points but negated the rise later in the day to end 247 points up.
Terming the cut as a prompt move carried out in the best interests in the economy, Deven Choksey of KR Choksey Securities said this is the beginning of a cut and we may see interest rates coming down gradually.
Ajay Bagga, CEO, Lotus India Asset Management Company, feels the rate cut was a big positive that surprised the market. “After nearly three years, this is the first rate cut. It signals the resolve of the regulators to move to a pro-growth stance.”
Shashank Khade, VP, Portfolio Management Services, Kotak Securities, felt the rate cut was expected even as it came a little ahead of time. “I am not sure whether the equity markets will really have too much to cheer immediately. Given the way the volatility in the markets has been, there has to be a much higher reward to actually invest in equity.”
What ails markets now?
Ambareesh Baliga of Karvy Stock Broking said the markets have their own set of problems. “There is a lack of confidence, which will not come just because of a CRR or a repo rate cut.”
Read more........... http://www.moneycontrol.com/
No comments:
Post a Comment