Money on the markets
A maturing market amid the mayhem
from Expert Zone:
(Nipun Mehta is an award-winning private banker with many years of experience across Asia. The views expressed in the column are his own and not those of Reuters)
About a year back in November, we were at the highest ever level of the Sensex with hopes of moving higher. A year hence, as we inch closer to the end of 2011, the Sensex has fallen more than 26 pct from its peak, and then recovered a bit.
In the interim, there have been bouts of volatility, long periods of dull range-bound movements, and a lot of events and learnings from the domestic and international markets.
The biggest learning in the last year has been for the present generation of investors who would not have seen such a long period of stock market underperformance and for whom the definition of long-term has changed. For those who started investing after 2003, the last three years have been an excruciating period yielding seriously negative returns. Most of these portfolios are still a few years away from returning to green. The key lesson is, short-term is out and long-term is in, with long-term to be defined as more than three years.
A petrol price hike always results in unhappy consumers, street protests and politicians trying to accuse the ruling government of being insensitive.
State-run oil marketing firms’ petrol price hike of 1.8 rupees per litre, the fourth such increase since March and the 10th since prices were decontrolled in June 2010, is another blow to the common man, already reeling under the pressure of rising food prices.
from India Insight:
Can central bankers play god to the markets? India's central bank chief Duvvuri Subbarao does not believe so. In doing so, the Reserve Bank of India governor, a physics student, has taken refuge in quantum mechanics.
from Jeremy Gaunt:
The Federal Reserve's "Operation Twist" has set the literary- and musical-allusion juices flowing. It is all about the Fed selling or not rolling over short-term debt and buying long-term bonds instead in order to keep borrowing costs low.
But that is frightfully dull for economists, analysts and reporters trying to get attention for their work. So, so far we have heard:
The BSE Banking index ended the day down 1.5 percent with stocks like Yes Bank and ICICI falling more than 3 percent.
SBI shares however bucked the trend and ended marginally in green.
Worries about more rate hikes have been bothering this sector, and banking funds recorded a fall of more than 5 percent in May.