Volatility in stock markets unlikely to subside in Q2, says Morgan Stanley

The bout of market volatility in the first quarter of 2015 is unlikely to subside in the second quarter, which is expected to be news-heavy, Morgan Stanley said.

The global financial services major said that it expects government spending to rise, at least one rate cut by the Reserve Bank of India if not two, and earnings to be better than in the previous quarter.

Progress on land bill and the goods and services tax (GST) bill would also be kept a watch on in Q2, Morgan Stanley added.

The bank said the government has budgeted doubling of divestments and bunching of supply is a risk to short-term equity prices.

(Reuters)