Last week, we saw sharp recovery in the markets, on expectations of a good monsoon. Both, the MET Department and Sky Met came out with a positive outlook on the monsoon, which prompted the bears to cover their shorts ahead of F&O expiry. US Homes sales data out last week and was above market expectation, so it lifted sentiment. Morgan Stanley on Wednesday, upgraded Indian markets to ‘overweight’ from ‘equal weight’ on attractive valuations compared with other emerging markets, strong macros, and recovery in earnings growth. Market participants are also expecting a rate cut by Reserve Bank in June.

Monsoon clouds hover over the Arabian Sea in Kochi yesterday. Pic/PTI