"A rich poet from
Harvard has no sense in his mind, except the aesthetic."
—Beatrice Wood (American,
1893-1998)
Word for the day
Ergophobia (n)
An abnormal fear of work;
An aversion to work.
Malice towards none
If my memory serves me right, earlier, RSS and therefore all its
affiliates, used to dislike Buddhism.
What is the current status on this?
First random thought this morning
The CBSE Board examination for class 10 and 12 started from Monday.
A visit to one of the examination centers confused me a lot. There were many
things, but this one thing was seriously bothersome.
Students from 7 different schools have been assigned to this
particular center (also a school) for writing exams. Most students, this being
their first "Board Exam", appeared nervous. The alien place further
compounded their anxiety. The parent accompanying the students waited outside
the center for hours, helpless, anxious and distressed.
This very concept of making students to go to different place for
writing exam, smacked of a "serious mistrust" of the system in its
own schools, teachers and students. It should be completely unacceptable; and
is also contrary to what PM Modi promised when he took oath of office in 2014.
What is bothering Indina markets?
In past one month there has been a
definite change in the market sentiment. A significant number of market
participants, who hitherto held an unqualified positive view on Indian
equities, have turned conspicuously cautious. A number of legendary investors
and reputable fund managers have sounded multiple notes of caution.
Even Rakesh Jhunjhunwala, fondly
termed Warren Buffet of India, has also opined, a couple of days back, that
Indian market might have already logged their intermediate top and may not rise
from current levels in a hurry.
Foreign bankers like CLSA and Morgan
Stanley have reduced the weight of India in their model emerging market
portfolios by 1-2.5%, in past few weeks.
This caution is on the back of
incessant selling by foreign investors in past many months. Out of past
9months, FPIs have been net sellers on stock exchanges for 8 months. The
domestic mutual funds and institutions have however bought whatever FPIs have
offered to sell. Nifty has is higher by ~3% since its July 2017 highs.
The bearish view amongst the
domestic participants however is still tentative and lacks strong conviction.
Hence, the domestic flows remain unabated.
What I gather from the popular
commentary is that the participants are worried about a variety of factor. Some
prominent of these factors could be listed as follows:
1. Earnings
growth has been below expectations, and may see downgrade in coming months. The
valuations appear elevated.
2. The
rate cycle appears to have turned. The next RBI may be a hike.
3. Banks
may see a fresh round of slippages.
4. Continuation
of production curbs by OPEC could see crude prices remaining firm and rise
further. Inflation & CAD situation may worsen.
5. Higher
US yields may see acceleration in FPI selling, even in debt, putting further
pressure on INR.
6. A
spate of election in next 15months could lead the government to focus more on
rural areas (higher farm subsidies and MSP) and less on urban infrastructure.
7. GST
stabilization may take longer than estimated, thus keeping the fiscal at
elevated level.
8. We
may see higher supply of PSE stocks to meet the fiscal gap.
9. Global
growth may falter as inflation and rates pick up.
10. Market needs to cool down after a sharp run up.
I shall present my views on each
of these concerns in coming days.
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