You may have felt that prior to the verdict of general public in America and across the World that the victory of Donald Trump shall bring the World market to the screeching halt, it has not worked that way ; though though was an immediate negative effect on the market. Post the verdict, the market not only go in for normalcy but made sudden upmove (though it was short covering) thus bring new hope in the minds of investors not only in India but across the World. We can sum up these development and possibly how the market can pan out in the coming weeks like -
1. President Donald Trump had been making election rherotics against the blacks and minority community which wooed the young generation and business community to support him. This formula worked in his favor. It was followed by another statement by him in which he announced that he is there to unify America and there shall be no racial discrimination. He helped boos the market sentiments - thus there were cheers in the market circles.
2. Demonetisation of Indian Currency - It is going to have a sober effect on the Indian economy in med to long run. Terror funding modules from across the borders shall not be able to play mischief, any more though, with passage if time, it may find some loopholes and are back to their nasty game. Fiscal health in general and banking system shall be better positioned. In that, banks shall have more deposits and shall hardly depend upon RBI to help them. Though, it would rest upon the RBI instructions and policy revisions, now on.
Yes, with the elite class not been able to sufficient cash in hand for some time to come, there shall be lower demand for the items of luxury and thus especially the consumer goods including may feel the heat of this development. Though, it would be good for the economy in the long run.
Reality sector (in the unorganised sector) has had a major jolt since it is mainly this sector where unaccounted money makes way. Apart from this, jewellery sector also suffers from this ailment. Having a close look at the jewellery shops one finds that people are trying to park their unaccounted money into buying gold even at exhorbitant prices to turn their black money into white. But at the same time, IT officials are keeping a close watch on such elements including the shop owners.
Overall, taking a overall look at the unfolding market situation, it seems that we are likely to witness the levels of 8100 - 8200. But we shall remember that, when we look at the Emerging economies across the World, India is a safe heaven. Though, time would tell but the way our government is taking the economy in its strides and the recent initiatives of taking the crux of corruption and the issue of running parallel currency, there is a possibility of India hitting to the double digit GDP in not too distant a future. With GST to be reality where there would be centralized taxation system, there shall be newer hope amongst the FIIs find India a much more safe and rewarding market in comes to come.
Stock market always plays smart and like the depth of sea which cannot be measured by any body, one should not take any hurried decision to park the money. Let us see if market oblige us for the above level - the level where lot of buying may be seen
As for our experience in the last - part profit booking to my mind has already been in place at the individual level. Besides, SIP mode is always in place - I strongly believe. Liquid cash, light baggage and there is where one is the major beneficiary to making the best from the market. Market never disappoints anybody provided we are organised and never fall prey to greed. Though, follies knowingly or unknowingly made by us cause havoc with our investment ; even if we try to play over - smart.