My view
Our GDP estimate for this fiscal is 7.1, which is higher than previous year. And. inflation too declines, which is positive news for market. Will this positive macro economic indicator pull money into Indian equity?
For debt market concerns both growth and inflation is negative news. So I feel the money will move out from debt market. But I am not sure that money will enter equity as election is ahead.
In recent past due to uncertainty in emerging markets gold has been considered safe for investment. Gold increased hitting new high. It didn’t correct much at the time of financial crisis. It had risen steeply with out much correction. Technically in chart I feel there is a huge correction in gold. It may lead gold to 500$ in international market. If it happens then too that money will not enter equity because in LME, technically in the chart, I feel nickel copper had bottomed out. I feel money from gold, incoming days, slowly will move to nickel and copper. If it happens so, shipping industry may start moving up for short period.
In emerging markets only India and china are looking good for FIIs. Fund from Netherlands are also going to come into India. China is largely depends on US for its revenue .Still US is in great trouble Chinese economy will not revive until US recovers..
For Indian market, technically in chart, I feel there is no any strong sign of bottoms. There may be some pullback rally. But not bulls run. According to analyst estimates US will recover by this September if it happens then US stocks will be cheaper than Indian stocks.
By and large, to my knowledge, in this situation fund may come into Indian equity for a short term only that too after election. I feel another correction is ahead in near future say after six months. Only then we will see real bottoms for Bull Run.
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