1. The World This WeekJul 11 Jul 15, 2011

2. Equity View:Last week, we saw TCS coming up with decent set of numbers. Volume growth was 7.4%, revenues were up by 6.4% q-o-q,PAT was flat on q-o-q basis; there was 200bps decline in margins because of increase in wage cost. The numbers were aboveestimates & we expect TCS to be leader on earnings side in the IT space for next few quarters. We are holding TCS in Alphaand in fact we are equal weight on IT as a space with exposure including Infosys, TCS & HCL Tech.Results season also started in US with Google, JP Morgan & Citi Bank coming with their numbers, all coming up with betterthan expected numbers. Google came up with phenomenal set of numbers which were way beyond expectations, stockjumped by 10%, when results were announced.In Europe, bank stress test was announced wherein 8 out of 90 have failed this stress test & it is expected that some kind ofrecapitalization exercise that would be done for these banks. Situations remain little fluid as far as peripheral Europe isconcerned. After Greece, there is a fresh round of concern in Italy, Spain & Portugal. We are monitoring and observing anydevelopments very closely, would keep updating our view on the same.Inflation number for June for India came at 9.44% which was slightly below expectations. We expected the inflation numberscontinue to hover around this level for at least next 4-5 months. In October - November we expect the numbers to peak outand should then start coming down. IIP for month of May came out at 5.6% which was way below the expectation whereas ofaround 8.5%. The IIP number has hovered around this mark for last 5-6 months and expect that going forward the numbershould improve by some kind of revival in capital goods activity.US has deadline of 2nd August 2011 to raise the debtlimit for the government and we continue to monitor the negotiationsand developments very closely. In case the US lawmakers fail to raise the agreement on that, there is risk that of USdefaulting on their debt liabilitiesIn terms of results in India, it is heavy week. We expect Axis Bank & Cadila to come up with there number, expectations arethat both the companies should deliver profit & sales growth in excess of 20%.

3. News:DOMESTIC MACRO: Indias wholesale price index (WPI) rose an annual 9.44 percent in June. The primary articles price index was up 11.58 percent, compared with an annual rise of 11.56 percent a week earlier. Annual fuel price inflation accelerated to 12.85 percent in June from 12.32 percent in May. Indias industrial output in May rose a slower-than-expected 5.6 percent from a year earlier.GLOBAL MACROU.S.: Exports slipped 0.5 percent from the April record to $174.9 billion as shipments to China fell due to Chinas exchange rate manipulation, industrial subsidies, state-owned enterprises, and weak regulations. Imports rose 2.6 percent to $225.1 billion reflecting record imports of businesses investing in machinery & equipment, and food, feeds & beverages in a sign of resurgent U.S. demand.China: Inflation rate accelerated to a three-year high of 6.4 percent year-on-year in June. China raised rates by 25 basis points, the third such increase in this year which took the one-year bank deposit rate to 3.5 percent.Italy: Italys parliament was set on Friday to approve a 48 billion euro austerity package aimed at averting a full scale financial crisis but there were growing questions about the governments capacity for further reforms.

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