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Sensex's Staggering Performance Despite the Fed Rate Hikes
May 2, 2018


Tanushree believes we could see a 30% correction from the peak. But she has also predicted the Sensex will rise to 100,000 In the long-term.

Why?

Because in the long-term, only earnings drive stock prices.

Today's chart illustrates the same.

The Indian stock market has done relatively well during the last period of rate hikes by the US Fed.

Take 2003-2006 for example...

Between 2003 and 2006, the US Fed rate moved from 1% to 5.25%.

Despite this, the Sensex rose from 3,500 levels to more than 10,000 during the same period. This increase was supported by strong earnings growth.

So, in the long term, rate hikes (triggered by economic growth) have proved good for the Indian markets.

In fact, earnings growth is at the heart of Tanushree's prediction of Sensex 100,000.

Data Source: BSE, US Federal Reserve

This Chart Of The Day was published in The 5 Minute WrapUp - Helicopter Money is About to Vanish. What Happens to the Market Now?

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