Saturday, 20 October 2018

Financial Markets @ October 2018


Season Greetings.

Worst seems to be behind us. Unwinding of leverage position of HNI led to sell off in the market. NBFC borrowing short & lending long in the falling interest rate scenario had favorable position though with the hardening of the interest rate played spoilsport. To add its hue & cry crude kept inching up.
Crude looks like settling somewhere near its current level. Further, the possibility of further increase of quarter % of basic interest rates can’t be ruled out. Weakening of the currency which is bound to happen over a period of time was allowed to balance itself which in way supported market in huge way.
Weakening of currency has also helped many segments in a way. Exports data YOY basis is on upsurge parallel to the corporate earnings which will be getting announced by November.
Markets are priced relatively better with a fall of market around 20% broadly and weakening of rupee around 7% (virtually with an impact of 27%.
Liquidity is not a concern as it used to be the case with previous falls. Going forward Crude and interest rate would only be factor to be closely looked upon.
Macro parameter currently is in best of it shape with lower fiscal deficit & Current account deficit around 2%.
Equities certainly to be looked upon for long term in a way of SIP and debt fund is having great opportunities for returns of more than traditional bank long term rates as these Debt Funds has advantage of better post tax returns with indexation benefits for holding period of 3 years or more.

1 comment:

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