Take Informed Decisions To Steer Clear Rough Weather

Ending all the speculations, finally Donald Trump, a seasoned real estate mogul and also a familiar faceon entertainment television, made it to the Oval Office of the White House on November 9. Indian markets taking an early morning cue, witnessed a bloodbath but closed on the very day reasonably better--Sensex saw a fall of 1689 points but gained back 1351 points by afternoon showing all’s not that bad with Trump. Indian markets had yet another reason to get gripped in panic on this crucial Wednesday as the night before, country’s Prime Minister, Narendra Modi came on news television and announced his government’s decision to scrap Rs 500 and Rs 1000 notes giving the holders of these high-value currencies only three hours of time to react before these currencies were declared ‘illegitimate tenders.’ On the wake of such two major developments, markets here still held back their essence upto some extent and investors also did not shy away from taking advantages of the highs and lows. The spirit of Indian equity markets, in fact, over-trumped even Donald Trump’s coming to the White House.

Where do the markets go from here--that is the billion dollar question all of us must be having in our hearts and minds at this time. I find no reason for further panic. Give the markets few weeks of time--let the system gets completely cleaned with the introduction of new currencies and absolute scrapping of the old ones, read black money. The economy will be stronger and without having any shadow of unaccounted and illegitimate wealth of some people. The truth will emerge soon and it will lead to a stronger economy, stronger and wealthier country.

Donald Trump is not an enemy of India or its industries--let us face the fact. After all, he is a businessman and understands business pros and cons very well. The man born in New York way back in 1946, just a year before India’s independence, might have talked against certain interests of India but he kept referring back to India at times, passionately. One thing is clear--he has nothing personal against our country or the businesses done by our country’s companies and men in the USA. Let us look for a better, warmed business relation with the USA from now. There may be certain temporary affects on two-three sectors following Trump’s victory and also the antiblackmoney drive by Modi’s government, but then why don’t we see the bright lights emerging from GST kind of developments too. The brighter ones will overshadow all the negative sentiments. So once again, be choosy and pick your stocks. Keep real estate stocks away for now--but don’t forget to pick your favourite banking stocks. Those will sizzle and that impression was very much felt even on November 9 across the markets’ hours. I will also believe that FMCG and cement sectors can be considered for a fresh round of investments. 

Earnings season has been mixed so far and earnings growth can be expected to improve in the coming quarters. Recent manufacturing data has been impressive and only supports the argument that India’s economy is on right track. One of the most interesting aspect of the Indian economy has been the increase in sales of trucks or heavy commercial vehicles. We believe it is a leading indicator suggesting that the economy is recovering.

Amid all these happening around, in this edition of your favourite investment fortnightly, we are talking about how to be a better and smarter investor. I am sure you will agree with the subject chosen at this time when some of us may be slightly confused, scared and even hesitant to put money in the markets. I am sure you will find the cover story package exciting enough--also do check out the outcome of the investors’ survey which we carried out with the help of your participations. We also have come up with a special story on second quarter earnings and an exhaustive report on how participation of retail investors has been witnessing a rising trend. Both will guide you through in these days of market highs and lows. 

Hope all of you had a bright and safe Deepavali. As winter approaches, the best time of the year, don’t panic, stay informed, stay aware and invest. 

Stay safe and invest wisely.