Budget To Set The Market Trend In The Near Term

Budget To Set The Market Trend In The Near Term 

The new year has started with great expectations even as S&P 500 and Nasdaq touched their records highs on the first trading day of 2018. In India, we have a major event coming up in the form of the Union budget in February, which should provide a clear direction to the markets. Till that time, in all likelihood, markets may trade sideways. Expect the Sensex to trade within the 33,500-34,500 range till the budget. 

I can already see fertiliser stocks and stocks related to agriculture sector gaining traction along with power stocks and realty stocks ahead of the budget. It is important that investors don’t get shortsighted due to the upcoming event and lose focus on the long-term opportunities that the markets have on offer. Long-term investors have a chance to accumulate select quality banking stocks. 

Overall, the market condition will be good and investors can stay invested in the markets throughout 2018. As of now, there are no signs of weakening of the economy; however, with very low probability of interest rate cut by the RBI and increasing crude oil prices, the markets might face some headwinds while moving towards higher ground. The crude oil is trading at its three-year high and this may weaken the bullish market sentiment. Investors need to pay attention to what is happening with crude oil prices as we move ahead into 2018. 

In this issue, we have shared the advantages of investing in ELSS and have recommended top seven ELSS schemes for investment. Indeed, ELSS funds have been able to deliver consistent performance and for the past one year the average performance of ELSS has been an impressive 40 per cent. 

In this special edition, we have covered extensively all the major sectors in India and have analysed their H1FY18 performance. We have shared analysis of top 1000 companies based on their market capitalisation and I am sure long-term investors such as yourself will benefit immensely from the insightful reviews. 

Those who have participated in the markets through 2017 may find 2018 a little more volatile. Year 2018 is the year of growth for the Indian economy and the listed companies will grow in line with the broader economic trend. Small-caps and mid-caps may continue their outperformance, so stay invested in both the spaces. 

For those looking to make changes in their portfolios can bank on the rural India theme. The focus on rural economy and agriculture sector by the current government will usher in durable investing opportunities in the space. We will keep you posted on the most relevant and exciting opportunities in this space via your favourite investment magazine.

Think equity, think long term!