MARKET SCENARIO

THE better-than-estimated quarterly earnings of some top US invest- ment banks last week may have slightly eased fears and given a fillip to the US markets on Friday. Yet investor sentiment remains nervous. Analysts maintain that overseas investors are likely to book profits on every rebound here on, due to rise in 'risk-aversion' to shares of emerging markets, including India. Traders are unlikely to take lightly the news of Monsoon Capital, a $1.2-billion hedge funds, far-
ing badly, as a result of the meltdown in Indian equities in the past couple of months. while Monsoon's exposure to Indian equities may not be as significant as compared to other major funds, there are concerns that the news may trigger more redemptions from other hedge funds with higher exposure to India. One of Monsoon's funds has dropped roughly 45% since January. "With such kind of news amplify- ing India's underperformance, there will be more redemptions from investors in other funds because of the herd mentality. The under- performance in Indian markets compared to others in this fall, is a clear reflection that India's growth story is yet to be understood well," said a senior institutional sales person with a brokerage, which services forty-odd overseas clients.
STOCK-broking firms will have to notify clients about their(clients') daily margin positions from April 1, according to a directive from market regulator Securities and Exchange Board of India(Sebi). The move follows a spate of complaints from investors that brokers have been liquidating their positions citing insufficient margins, though their margin accounts had enough funds. The other common complaint is that investors were not aware of the quantum of margin money that had to be deposited to replenish the account. Such complaints could soon become a thing of the past once the new rule is implemented.