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Saturday, March 5, 2011

Political storm in India....macro view

The DMK withdraws support.Did the insiders know about this last week?Seeing the market reaction in hindsight I believe it was expected.Will Jayalitha(Amma) extend support.Will Mulayam Singh and his Samajwadi Party come into prominence once again?

Will the reform process be affected?With Bengal,Tamil Nadu&Kerala going to the polls in the coming months will the UPA find itself bound into a tighter straitjacket?

I feel it should galvanise the Government into action and we can expect a stiffening of the "spine"leading to more meaningful policy action.Very unofficially some "friends" in the met office tell me tha the El Nina` effect is likely to be milder hence expect a good monsoon.

The Nifty might react negatively but it would be a good bet to buy Nifty out of money/at the money calls for march expiry.A much maligned word "Infrastructure" is coming back into focus,those who have been invested in these theme funds plz remain invested.I find silver a more promising investment than gold but I believe I should present my case with more in depth analysis and bore you with a lot of facts and figs..!!