Industry Synopsis
  • As on October 31, 2011, total AUM increased 8% MoM as both debt and equity funds witnessed inflows
  • Net inflow for October was Rs 41,287 crore as against outflow of Rs 54,1473 crore in the previous month

Markets Last Month
  • Indian markets have been volatile but are trading in a broad range with movements depending on news flows from global equity markets, which have been even more volatile in recent months. The markets recovered around 13% from the lows in October only to give up the majority of the gains in November
  • Global equity markets have been volatile like a roller-coaster moving up and down with news flows from Europe having their impact on the Indian markets
  • Overall, the results for Q2FY12 have been disappointing from majority of the companies. Apart from lower margins hit by higher financing cost, forex losses due to depreciating Indian rupee also had a negative impact on the profitability of the companies. Expectation of a further EPS downgrade for FY12 as well as FY13 is putting pressure on the markets

Going Ahead
  • Weak economic data points coming out of European economies (rising borrowing cost of European crises, lower growth and political instability) coupled with weak economic data points from the US and China have raised concerns over a prolonged lower future global economic growth
  • With sentiments being negative, the markets may continue to trade in a narrow range with a negative bias
  • Short-term investors should wait for negative global news flows to subside and the markets to settle down