It was a trading week that would best fit the Bollywood description of a potboiler. From fear to gloom, and then to despair, the market had almost given up when Friday reversed the mood magnificently to create a typical happy end to the week’s drama.

The government decided that it would take a structural approach to bring back growth. The markets expected a tinkering approach. With such a wide perception gap needing to be bridged in one trading day, a surge was inevitable. Most market participants were caught unawares. The week ended for many with a sense of confusion of what to make of the government stance, how to adapt to the coming weeks and their choice of investment approach.

This confusion will persist given the huge wall of pessimism that needs to climbed. It will be the challenge for many to get a fix on their own conviction, to judge the right extent of optimism they need to display, and to adapt quickly to the emerging scenario. If the government follows up with more structural measures to boost investor and business sentiment, we are likely to see a phase of consolidation in investment behaviour.

The wall of fear will still need to climbed in the coming weeks and it will be interesting to see how individuals manage this rapidly changing scenario.

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