Moderate CRR cut would have helped
Given the macro-economic factors, what is your take on the equity market?
We have been talking about a range-bound market with a downward bias and it has been that way for some time now. The reason is that we have seen some deterioration on the fundamental factors like GDP growth coming off even while inflation has remained high for almost two years now. These factors have led to tight money conditions thereby capping the upside even though we saw periodic flow of money coming in from FIIs. The trend witnessed is that market is getting support at lower levels due to attractive valuations and, at higher levels it gets capped because of weakness in GDP growth and economic fundamentals. The investment climate continues to remain weak. There has also been a slowdown in earnings growth. We already saw the Nifty touching 5500-5600 levels on the upside and around 4600-levels on the downside and we believe we will trade in that range. The second half of the year could be better than the first half but that would be a function of two factors — developments in
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