Criticism against the central government for not able to curb the second wave along with the conduct of heavy election rallies were the major points.
This is expected to further decline in May and June while the big picture is that Q1FY22 will be the worst, and would improve on a QoQ basis from Q2FY22 onwards.
Initial IT results were in-line though it did not add additional outlook, while the latest tier 2 results are below par.
Then we had financials results which are well below the forecast with further rise in NPAs and provisioning.
But this concern diminished post clarification that US government and central bank will continue the massive stimulus campaign as elaborated earlier.
The news flow this week has been a mixed bag – with negatives like mixed state elections result, extended localised lockdowns and positives like RBI’s supportive policy and US Fed’s commentary.
At the same time, supportive fiscal & monetary policies by RBI and the government are providing some stability in the overall market.
Going forward, further worsening COVID situation will have detrimental effect, nevertheless long-term trend is intact.