The entry of Raghuram Rajan has taken the Nifty up 7%, and the bank nifty up over 12% from its lows. The Nifty is now touching the 50 day moving average.
(Click for larger picture)
The recovery came in on Thursday and Friday. Banks were up nearly 10% on Thursday, with a great follow up day on Friday.
However, this could still be a temporary move, as the US data shows a taper in US bond buying is much more likely now.
While equity markets rejoiced, bond markets didn’t. The two days of the new RBI governor have seen rising rates:
And the dollar has improved dramatically:
(While this is the RBI ref rate which is fixed at 12 noon, the end day rate was even further lower at 65.)
The next week is shortened (with a Monday holiday in India) but will see both IIP and inflation released, and Import-Export data too. Will Rajan’s good run continue?