Indian equities may see sluggish trading sentiment early this week following data that India’s CAD touched a record high of 6.7 per cent in the October- December quarter, but the markets are expected to bounce back in view of the recent downtrend.
Analysts said the sentiment is likely to be subdued as investors may react to the Current Account Deficit data that was made public by RBI in its report on Balance of Payments - released after market hours on Thursday, followed by long weekend because of Good Friday holiday.
CAD, which is the difference between inflow and outflow of foreign exchange, widened from 5.4 per cent in Q2 (July- September) to a record high of 6.7 per cent of the GDP in Q3 of 2012-13 fiscal, driven mainly by large trade deficit.
However, some analysts said that the recent downtrend in the market may prompt some value buying and push it up after the initial reaction to CAD, if any.
“The recent sharp fall in the market suggests that much of the negativity may be discounted and it can see a bounce back,” Milan Bavishi-Head Research,Inventure Growth and Securities. PTI