Receiving Facilitation Award

Receiving Facilitation Award - Platinum, Second Time in Row by Mr Rahul Rai - Head Real Estate Business , ICICI Prudential at The Park , New Delhi on August 3 ,2012 .

                                      MARKET OUTLOOK - AUGUST 2012

The equity markets declined marginally in the month of July posting negative returns of 1%. Gold

rose marginally during the month while Crude Oil surged by 8.66% to $89.92/barrel. Inflation

decreased to 7.25% in June compared to 7.55% in the previous month. US market is trading at 52

weeks high and other global markets have also picked up in the month. On domestic front, we

have a bad monsoon and this may aggravate problems especially on inflation front. RBI has left

key policy rates unchanged and revised FY13 GDP growth to 6.5% from 7.3%. The RBI also

maintained that the main focus of the policy would be to control inflation.

We believe that market is likely to face pressure in coming months if Govt. officially declares

draught and inflation goes up. Markets have been waiting for some kind of positive

announcement on economic front by govt. of India but so far no announcement has come.

Thought markets remain weak in short term but Long Term investors should use intermittent

corrections to accumulate equities for coming years. We hold our advice to investors to keep

buying equity mutual funds through SIP/ STP route to generate wealth over the long term. On

debt side we recommend Dynamic Bonds Funds and Medium Term Income Funds. We advise

adding income funds in your portfolio in gradual manner as we may enter soft interest regime in

second half of the year, but investors should avoid aggressive income funds at this point to time

which take long duration calls. We maintain our view to hold 5-10% allocation to gold in the

overall portfolio.