New Delhi, Feb. 10 -- Dear reader,

Last week, I wrote about market trends being dependent on follow-up action from participants. The action was half-hearted as traded turnover fell over a cliff. The index futures weekly turnover was a meagre 8,14,108 lots, constituting no more than two trading sessions. The last three sessions of the week saw delivery segment clock turnover of under Rs.1 trillion consecutively. This is worrying. Admittedly, Friday's RBI policy announcement on interest rates played a major role in this reticence.

The 25 basis point (bps) rate cut was met with nervousness as the markets fell on Friday. Indian 10-year benchmark bond yields spiked after the rate cut was announced. Yields spike when bond prices fall. Bond tr...