Hello patrons! Let me begin today's blog with a quote by Mark Twain on the Stock Markets.
"OCTOBER: This is one of the peculiarly dangerous months to speculate in stocks in. The other are July, January, September, April, November, May, March, June, December, August, and February."
Speculation leads to bad memories of stocks. We have been proponents of investments through this blog and will continue to suggest only investments and not speculation.
After a fabulous Monetary Policy by the RBI, the mood in the markets was exuberant. In this blog we had clearly stated that we are headed towards 8200 on the Nifty. And 8200 did arrive, albeit on the last trading day of the week, but it arrived alright. What lead to this rally?
There are two factors which led to the rally.
1. As stated in the last blog the Monetary Policy seems to have had an effect on the behavior of the INR against the USD, as was suggested by us. The INR gained almost 2% in last week. The strength in the INR is a welcome sign for the equities and further rally in the INR can't be ruled out. We expect the INR to be around 64 in coming days, which should fuel further up move in the equity markets.
2. The US jobs data last week was below expectations, which led the global investors to believe that the FOMC will hold the increase in interest rates at least till the calendar year end. This sparked a global rally, of which we were also a part.
Where do we go from here?
The result season has begun with Indusind Bank today. We believe this month would be a month of consolidation and stock specific action.
The mantra remains the same. Invest in good quality stocks in every dip and stay invested.
Happy Investing!
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