The 2015 Diwali Muhurat trading session ended on a greenish after the slew of Modi government FDI reforms in response to the Bihar Debacle.
The markets may witness a short term euphoria as a result of these FDI announcements but the dismal Q2 earnings and the Dec Fed Meet will keep a check on any run up in the markets.
The broader market situation has been completely gloomy in the last few quarters owing to both global and domestic factors. Even the recent announcements which includes the power reforms as well will take at least 2-3 years to be transformed into any deliverables.
The backbone of the economy, banking system, both private and public are in a complete disarray due to rising NPAs and are lacking the financial prowess.
Even the defensives like IT and Pharma, saviours of the market in tough situations are not performing their roles. The Autos, CDs, CGs and Telecoms of the world are also struggling to be dominant players of the consumption theme.
The overall markets are in a completely gloomy situation and stock specific themes are working. Most of these themes are in mid and small cap categories which are risky propositions when compared to the bellwether stocks.
D-Street is completely looking clueless at this point in time. The interest rates have eased and now is the time for the government to step on the gas pedal for big bang reforms like GST, LAB. They need to work with opposition parties and the state governments to induce the desired competitive federalism.
All in all, they need to work with all the stakeholders of the democracy via aiming "consensus politics" and not "vindictive politics"
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