Thursday, May 8, 2014

Auslander Raus and Nifty 7K...?

What is the similarity between a slogan used by Neo Nazis in post Hitlerian Germany and the Indian Elections?

In an acrimonious,often hyperbolic confrontation between the leading indian parties,namely BJP and Congress - the issue of foreign birth,caste and social levels has come to play a major role.A lot of the top Congress leadership has stayed away from the battle quoting medical and other problems.It is a problem of incumbency,a lethargy that set in towards the last 2-3 years of the present government.

Dr Manmohan Singh,yes him of the innumerable innuendos and jokes on whatzapp,has not shown himself on behalf of the Congress in this entire campaign.Is that his way of showing his irritation at being used as a proxy?Who knows...as he is too much of a gentleman to express his opinion in public(or private?).

Two decisions of leadership in my mind are responsible for the mess that the Congress as well as the nation finds itself in.

Pranab Mukherjee as Finance Minister
Montek Singh Ahluwalia as Deputy Chairman of Planning Commission and trusted Singh aide de camp

If we go by Sanjay Baru's book the former was fostered on Dr Singh by Mrs Gandhi and the latter by himself.Both looked tired and directionless in their policy making.

The social media savy campaign and the directness of Mr Modi I think will appeal to Indian voters across segments and especially in Metros,Tier-I,II cities where people want better amenities and not just freebies and platitudes...!

As far as predictions go...post 16th May it certainly looks like a strong Government at the centre led by Narendra Modi will take centrestage.

  • Not removing Raghu Rajan as RBI Governor 
  •  The position of 'thought leaders' of the calibre of Prof Bhagwati will show the intentions clearly.

Stockwise there is an air of expectancy around Infrastructure stocks as well as PSUs which need new business ideas ASAP.

Will the Nifty break out further from current levels and cross 7000 is open to conjecture.Inflation and a looming Russo-Ukraine conflict are immediate threats especially if the 60% chance of El Nino comes true in July.I reccomend a 7000 Nifty May Ce and a 6000 Pe to hedge your portfolio.

Remain on the sidelines if not sure,its not worth the risk.Luckily we will get a small preview with exit polls on 13th May....but exit polls historically have been way of the charts most of the time so it will serve well not to put too much faith in them!

Quiet flows the Hooghly till then...

  Expected Seats  
BJP+NDA 286  
Congress+Allies  <100  
Others 50    

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