During the course of the week Sensex lost 1060 points while the Nifty lost 219 points.

Both the indices lost more than 3.75% during the last week which should indicate the weakness of the market. Last week we informed that the RBI announcement holds the key to the direction of the market. After the RBI Governor announced the policy decision on Tuesday, the market went down sharply.

We cannot blame the RBI governor alone for the state of the market. In fact the root cause for the market is the lackluster results. India has been ranked at 142 among 189 countries in the latest World Bank's "Ease of Doing Business" report. Among other major countries, the US has been ranked seventh, Britain (eight), China (90), Sri Lanka (99), Nepal (108), Maldives (116), Bhutan (125), and Pakistan (128). The policy decisions of the Government have to witness sea change to get the investors’ confidence in India. Modi Government has to check the progress of the reforms measures.

An interesting study by the SEBI informs that 50% of retail investors have exited the market in the last 3-4 months.  In the past few years, retail investors have pressed the exit button in panic as the volatility has increased drastically. Will the SEBI react in the right way to woe back the retail investors? We will have to check if it does.

As far as the market is concerned the Nifty may continue to remain weak in the coming week. A close above 8400 would be considered as a good sign to the Bulls while a close below 8000 is a good sign to bears. The Meteorological Department announced that the southwest monsoon set in over Kerala four days later than the normal onset date of 1 June. Will the rain God help the bulls to sustain above 8060? We will watch the market and inform you about it next week.