Markets Cautiously Optimistic At The Moment!
Market outlook looks cautiously optimistic to me at this point of time with no major worries in sight as of now. We would like to revise our Sensex target from 42,000 to 39,000 level for March 2019. In my view, RBI is playing spoilsport right now and has not done enough to propel economic growth. No business can be done if one is overcautious. RBI has been overcautious for too long in my view. The new RBI governor, I hope, takes a more pragmatic stand on interest rates and support the economy where it matters the most – making finance cheaper for businesses. I expect some interest rate cuts in the coming months.
The global economy outlook looks stable with the US and China finally showing signs of trade war dispute resolution. The currency is less volatile, crude oil seems to be settling down and interest rates are in no hurry to inch up globally. Looks like a good platform for equities to deliver this year.
The cover story in this issue talks about avoiding the “over-hyped stocks”. What are over-hyped stocks and how to identify them and basically how best to deal with them is what is discussed in the cover story at length. I am sure the message in the cover story will go a long way in protecting your wealth.
In our special story, we have given our economic outlook for 2019. We keep discussing how Sensex can gain owing to sound economic fundamentals; however, rarely do we focus on deeply understanding the economic development of our country and its challenges. You will exactly know the economy-wise problem areas facing us as a nation and the bright prospects that are ahead of us in 2019 once you go through our special report on India’s economic outlook. As always, I hope you will be kind enough to help us with your feedback on our stories in this issue.
The global economic outlook is not robust for 2019. In fact, there are signs of slowing in the growth rates in certain developed economies. This augurs well in my view for the emerging economies in 2019. The FIIs have turned net buyers in the last couple of months and I expect the buying momentum to continue throughout 2019. With no signs of money flows slowing down through mutual funds, liquidity is expected to remain healthy for the Indian equity markets.
Watch out for quality media stocks in the coming months and also focus on beaten down stocks in the sector that promise to revive and grow in 2019. I repeat what we have been saying since the beginning of the year – the year 2019 may well be a year for wealth creation and, in all probability, a much better year when compared to 2018. Focus on quality stocks across market capitalisation. Have a balanced portfolio and do not go overboard on any single sector. An actively managed diversified portfolio with the help of predefined investment process will do the trick this year as it should in any given year.
Show no fatigue in researching stock ideas—your efforts and sound investment process will pay off eventually.
Happy Investing!