Shocking IIP Nos for August 2008 were released today.On a yoy basis the overall industrial growth is a mere 1.3 % against 10.9 %
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SHOCKING IIP GROWTH FIGURES IN % FOR AUGUST YOY |
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| Sector | Growth % in August 2008 | Growth % in August 2007 |
| Overall Industrial Growth |
1.3 |
10.9 |
| Manufacturing |
1.1 |
10.7 |
| Mining |
4 |
14.7 |
| Capital Goods |
2.3 |
30.8 |
| Consumer Durables |
5.1 |
6.2 |
Clearly we are staring at a recession in India too following global slowdowns and even meltdowns
The Sensex is critical and at 12.44 pm is down 1042 points at 10286 plunging 9.19% already.The circuit is at 10% of quarter closing of 12750 and not 10% of yesterday’s closing of 11328…so watch out for a fall of 1275 points to halt trading on BSE
RBI has announced a 150 basis CRR Cut and Infosys has lowered earnings guideline for FY 09 to to Rs 101.06 this morning
Times are clearly tough…ICICI Bank is down 26 % to Rs 335 ! just today…What is wrong here ? Will this Bank Collapse ? Is there some hole in the assets we don’t know about ?..SEBI Chairman,Mr Bhave has no answer to the question as to what is happening in ICICI Bank…He was talking in on CNBC right now
With such poor IIP figures expect further capitulation of Equities as Corporate Earnings slow down significantly and einfact raise the ugly possibility of a reversalin Earnings growth to negative territory
So how would this affect India’s GDP ?…Clearly expect it to be revised officially downwards.It is projected to be 7.9% for FY 09 but even this recent revision will be revised downwards again…FY 10 projections will be even lower
There is increasing redemption pressure on Mutual Funds and this will lead to them offloading equities in huge quantities
Even my 80 year old Uncle,who breathes the Stock Market daily before he even breathes in Oxygen and was born just before the Depression of 1929 and has been through it all,confesses he has never seen such financial fear and fright on this planet…and what he does not know is not worth knowing !