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Uncertain Times for the Benchmark Index
May 16, 2018

Do you get the feeling that the markets are confused?

I sure do.

In the last month, the market went down, up, down, and up again.

The net result was no gain, no loss.

It's almost like no one knows what to do. The reason for the confusion is a tug of war between the bulls and the bears.

So, I'll present to you, both sides of the coin.

The Positives

  • Economic growth is picking up
  • Effects of demonetisation and GST are rapidly wearing off
  • Inflation is stable
  • The RBI remains on hold
  • Urban personal consumption is as strong as ever
  • The government continues to spend tons of money in infrastructure projects
  • Corporate earnings have started rising
  • The aam investor is still putting money into stocks and mutual funds

The Negatives

  • Economic growth is nowhere as high as it should be
  • The threat of inflation hasn't gone away
  • Crude oil prices are still high
  • Large private sector investments in the economy are negligible
  • Job growth remains poor
  • The distress in rural India hasn't been resolved
  • Donald Trump's trade war
  • Foreign investors are selling

So, which narrative should you believe?

If you, like me, believe in putting your money in safe stocks, your answer should be clear: Neither of the two.


Well, it's simple.

Safe stocks are safe because these issues don't really affect them.

Data Source: BSE India

This Chart Of The Day was published in The 5 Minute WrapUp - My Top Five Stocks After the Karnataka Elections

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