Markets ended the week on a dismal note, extending losses for three straight weeks. In the process, the Sensex has lost almost 2000 points during this period. The assault has been led by Foreign Portfolio Investors, who have sold aggressively during the period.
After the NDA's debacle in Bihar, it's highly likely that the opposition may turn aggressive and this could disrupt the parliament session. If that happens, we could have the Rajya Sabha in a limbo, which means the GST Bill is delayed even further. All this is likely to see the markets fall even further.
Another reason why we might see some selling pressure in the markets is the strong possibility of an interest rate hike in the US in Dec. As corporate results remain poor and the chances of an interest rate cut in India look dim, we might see FIIs pressing sales next week.
Already they have been selling the Indian markets aggressively in the last few months. In fact, through this week they have been net sellers for all the 4 trading sessions.
All in all, it may not be the best time to invest now. The next week may see more selling pressure as we head into the crucial Fed policy meet and the Winter session of Parliament.
Clearly, expect volatile times ahead in the next couple of weeks. In fact, the markets may end the year on a dismal note.