India’s exchange traded funds are on a forward march, with the country’s benchmark index entering what some analysts believe to be a bull market. Can it stay there? Here are a few reasons why the answer may be yes.
* The Bombay Stock Exchange’s Sensitive Index, or Sensex, crossed the 19,000 mark for the first time since Jan. 18, 2008, writes Hemal Savai for Bloomberg.
* Industrial output, which grew 13.8% in July, is a major factor for growth in India. The double-digit output growth was much higher than the single-digit growth previously expected, comments James Lamont for The Financial Times.
* Christopher Wood, strategist at CLSA Asia-Pacific Markets, predicts that the country’s annual economic growth may top 9% in the next five years, which would make the country the world’s fastest-growing major economy. The economy expanded 8.8% in the second quarter year-over-year.
* India is seen as the only economy in Asia driven by domestic demand. India’s export gains fell more than 50% in July to 13.2% from the previous month.
* The Reserve Bank of India is reducing its credit-tightening policies as inflation abates and companies signal a peak in short-term borrowing costs, reports Anil Varma for Bloomberg. The Central Bank estimates that inflation will drop to 6% by March 31, compared to an average 10.5% in the first seven months of the year. Bond yields have widened to 0.63% against swap rates since February.
Better-than-expected growth numbers may prompt the central bank to further adjust interest rates, but current monetary policies still favor growth over inflation.
* The Bombay Stock Exchange’s Sensitive Index, or Sensex, crossed the 19,000 mark for the first time since Jan. 18, 2008, writes Hemal Savai for Bloomberg.
* Industrial output, which grew 13.8% in July, is a major factor for growth in India. The double-digit output growth was much higher than the single-digit growth previously expected, comments James Lamont for The Financial Times.
* Christopher Wood, strategist at CLSA Asia-Pacific Markets, predicts that the country’s annual economic growth may top 9% in the next five years, which would make the country the world’s fastest-growing major economy. The economy expanded 8.8% in the second quarter year-over-year.
* India is seen as the only economy in Asia driven by domestic demand. India’s export gains fell more than 50% in July to 13.2% from the previous month.
* The Reserve Bank of India is reducing its credit-tightening policies as inflation abates and companies signal a peak in short-term borrowing costs, reports Anil Varma for Bloomberg. The Central Bank estimates that inflation will drop to 6% by March 31, compared to an average 10.5% in the first seven months of the year. Bond yields have widened to 0.63% against swap rates since February.
Better-than-expected growth numbers may prompt the central bank to further adjust interest rates, but current monetary policies still favor growth over inflation.
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