OUTLOOK 2018-19:BEYOND THE CLOUDS
Since our last review markets have been moving in a range.Kya acche din aarahe hain?
Let us explore
Continuity of earnings growth is important over the next 2 quarters.
Government capex is the key driver for growth.GST collections have been lower on a month on month basis which is a short term problem.
In our view it will take a couple of quarters to start the capex cycle.
Interest rates are increasing in the US.
If world rates rise Indian rates will also rise which is reflected in the government securities.
Crude prices if go above 70 dollars will create a fiscal challenge for India as we are net importers.
The Gujarat win symbolized acceptance of the reforms undertaken by the government.
The Budget may reflect a rural focus which needs to be seen in the coming budget.
The charts show 11000 nifty levels as a possibility.
Our view is it is likely to happen by March 2018.
On account of the fund-flows in both debt and equity segments rupee is likely to appreciate.
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