Some other equity markets in the world had bigger bounces (see chart), suggesting that one needn’t attach much significance to India’s performance. The rupee closed 0.28% down while the 10-year bond yield ended at 7.181%, compared to its previous close of 7.134%. Kotak Institutional Equities thinks the market’s focus will increasingly shift to the macroeconomy and corporate earnings. This means that the 10-year bond yield could rise in the coming days in anticipation of this fiscal slippage. These factors, along with the macro worries, should bring in more volatility in sentiment in the coming days.

Source: Mint December 19, 2017 01:52 UTC