Markets in a minute

The market's wacky roller-coaster ride in the week gone by kept the studio on its toes. Here's a snippet of what was being discussed.

Aditi: Will it be an encore of 2008? S&P's downgrade of the US economy last weekend is being seen by many as a warning shot. Fears of a double-dip recession in the US have roiled markets across the globe.

Vikram: Adding to the jitters are the seemingly never-ending troubles on the other side of the Atlantic. Many countries there are still struggling with their bloated debts! I think it's gonna take a long time for Europe to come out of the woods.

Aditi: You bet. And despite all the brave talk by the powers-that-be, market worries just don't seem to abate. The US Fed's assurance that interest rates will be kept near zero levels for the next two years soothed some frayed nerves, but only just. It was soon back to sharp dips and high volatility on the US bourses.

Vikram: The Indian bourses too didn't escape the mayhem and wild swings… markets seemed to be torn between fear and greed. Sharp intra-day dips followed by impressive recoveries, only to be rounded off by further steep falls - this characterised trade for most of the week. Tuesday was particularly traumatic.

Aditi: Clueless – that best describes the market mood in India. And that's kind of understandable. On the one hand, we have our own set of troubles with stubbornly high inflation, rising interest rates and fears of a slowdown. But for all its woes, the Indian economy still seems much better off than most others, at least for now.

Vikram: Yeah… Finance Minister Pranab Mukherjee thinks that when the dust settles, India may emerge as an attractive investment destination for global money.

Aditi: For the moment though, investors seem to be placing their bets on that time-tested safe haven – gold. The yellow metal dazzled ever brighter and soared to new heights this week. It's close to Rs 26,000 for ten grams now.

Vikram: Black gold though moved the other way. With the global economy looking shaky, crude oil treaded south. Much to the relief of our beleaguered oil marketing companies, which face the brunt of subsidies.

Aditi: The government would also have managed a faint smile. A dip in the price of crude oil should hopefully ease the raging inflation in the country. With the latest price rise number coming in at a high 9.9 per cent, the government would be seriously worried. So would RBI Governor Dr. D. Subbarao who received a two-year extension.

Vikram: Air India though saw a management shake-up with Arvind Jadhav given the marching orders and Rohit Nandan brought in as the new chairman to tackle a dire situation. With the national airline fast sinking into financial quicksand, the government seems to be in panic mode.

Aditi: I guess, change is the only constant. With the lacklustre June results season drawing to a close, let's hope for better tidings in the coming quarters.