News flow with respect to GDP growth, earnings growth/downgrades would get worse before it starts to look up. Hence Q1 would be tough for the markets and it can correct 8-10%.
Markets stop panicking when policymakers start panicking. The good news is that we could get some positive returns in 2012 if policymakers take steps to reverse the economic slowdown: like a) aggressive rate cuts by RBI and (b) policy reform by the Government.
Rates - We believe an aggressive rate cut by the RBI will help the market in late 2012. While we see tough times for markets near term, we
believe we could end 2012 with a positive return if we see aggressive rates cuts by the RBI and Government takes policy decisions to kick-start
investment spend.
Markets likely to move in a larger trading range: Sensex~ 14,500 –19,000
