Time To Get Cautious In The Near Term!
Analysts tracking global markets expect a contagion effect to play out in the emerging markets. This may well happen in all emerging markets, thus damaging the growth prospects of individual countries, except India. India is a sound economy displaying its inherent strength to the global investors, as reflected in the latest GDP data. The weakening Indian rupee is not an isolated event impacting India alone; however, logically the Indian IT sector and export-oriented stocks should benefit owing to this development. No wonder, the IT stocks have been doing well recently.
India is improving its global clout and its standing among the comity of nations is improving under the able leadership of our Prime Minister Narendra Modi. With improving image and recognition, the global investors are becoming more comfortable when investing in India. While it is always good to have global investors preferring to invest in India- the fastest growing economy in the world- let me remind you that we are no more a nation at the mercy of foreign portfolio investors (FPIs). Today, the domestic flows dominate and dictate the market moods more than the inflows from the FPIs. That, to me, is a reflection of our strength as a nation. We reiterate our Sensex target of 42,000 by the end of March 2019.
The rising crude oil prices do concern me as it is indeed a double whammy for the Indian economy with declining exchange rate. With rising crude oil prices, the petrol and diesel prices are touching all-time highs in India. I take this opportunity to urge all my readers and fellow citizens to consume less of petrol and diesel. Car pooling would be a good solution, whenever and wherever possible. This way, we can contribute our little bit and save our nation’s energy bill. 
In this issue, in our cover story, we have shared, after rigorously scanning stocks that have risen more than 50 per cent in one year, a list of 35 stocks where we believe one should book partial profits. In my view, profit-booking is a must and the time is ripe to churn your portfolio. Do let us know if the list is useful.
One of our special stories talks about the life insurance sector in India and how the stocks in the sector are faring. Do read it carefully and check if you can include any of these insurance stocks in your portfolio.
The other special story focuses on the growing retail sector in India. Indeed, retail stocks have impressed with their performance on a YTD basis. Again, check if there is some room for retail stocks in your portfolio. I would suggest you to better create some.
Markets will remain volatile as bulls and bears will test each others’ convictions. Also, as we move closer to the election dates, markets can move in either direction, thus giving opportunities for everyone who may have missed investing in quality stocks. Those who show patience in the markets in the coming months, in my view, will be rewarded handsomely. Use the dips in the market to pick your cherry stocks and do not panic at any stage as the markets are in good shape and structurally look like heading upward in the long term.
Happy Investing !