RBI and Govt. Clash openly

https://m.economictimes.com/news/economy/policy/govt-issues-statement-on-spat-with-the-rbi-says-will-continue-to-engage-in-consultation-in-public-interest/articleshow/66443056.cms

As ET reported last few days Govt. And RBI are not in good terms. After Raghuram Rajan was removed the new governor hasn't been very helpful for govt.

It's a fact that global interest rates are rising led by US. Govt. after disasterous Demonetization and a botched GST wants credit or loan growth to happen. But unfortunately time for that has run out.

Jaitley is right that RBI looked the other way after 2008 when rampant loan growth happened. But that was globally coordinated easing. I am sure BJP and Jaitley would have jumped into that if they were in Govt. then. Blaming RBI now is a bit opportunist.

The loser will always be the unprepared citizens.

But this fits nicely into the coming political chaos in 2019 as I had said earlier.

Oct 31st. Last day of Month.

I still see today as a buy and some strength seen. My month start prediction of sell on Nifty has come true. Nifty began at 10930 and will probably end today 102xx.

Rupee is weakening again and will give strength to stocks today.

1. TCS and Infy are a buy. Week started as a reaction buy but I wasn't sure but now it is. I do not see any collapse in them yet. Might see some 5-10% up. We have to see. Both of the month start sells have come true.

2. Coal India is still directionless but showing some sell, need more confirmation.

3. Hindustan Lever showing a short Buy but is still a loger term sell.

4. Godrej Consumer a trend change this week, lets see but may be up today.

5. TATA Motors reaching a localized high. No major buy yet.

6. Sugar stocks have reached a high and should fall now. Long term trend is still buy so fall a good time to buy it.

7. Deepindustries a good buy.

8. Yes Bank should show minor weakness.

9. Assamco and Starpaper a buy.

10. Navkarcorp small buy.

11. Vsttiller a sell for now.

12. Bajajfinance, Ashokleyland and Heromotors directionless.

Oct 30th Views

Oct 30th Tuesday seems a buy in nifty more or less. After US market fall last night I was suspecting we might fall too but last night nifty indicators showed positive and that is confirmed by Asian markets looking better.

I think US weakness is due to the elections where people are worried what the Leftists and Democrats who are calling for violence might do. So until US midterm elections are done we may not see much upside in US which favors our sensex.

Today
1. Hero motors should show sell and weakness.
2. Greavescotton buy
3. Persistent computer weak sell
4. Navkarcorp some trend change
5. Starpaper still buy
6. Assamco sell
7. Yesbank is a sell for day but should show some weekly strength
8. HDFCBank directionless may be today but showing strong sell soon.
9. Deep industries buy
10. Sugar stocks up again
11. Tatamotors may be up today but weekly sell
12. TCS/Infy still showing weakness
13. Asian paints sell.

Week starting Oct 29

Buy today on Monday but week is sell only. By mid week mood will turn again from buy to sell.

Let's see how many month of November prediction begins in 2 days.

TCS and infy weak though.

More Rupee devaluation coming

BofAML says RBI dollar reserves not enough to save Rupee

India’s foreign-exchange reserves are shrinking fast and may soon reach a level that could hamper the central bank’s ability to defend the rupee, according to Bank of America Merrill Lynch.

“You have sold so much that your ability to sell is becoming more and more constricted,” he said.

What will happen to Rupee if RBI is unable to defend as US dollar interest rates continue to rise..... 😨

If RBI defends Rupee by raising interest rates what happens to economy with defaults rising in banks NBFCs , bonds and real estate.... 😨

Political heat and CBI as we head to 2019

Crisis in CBI detailed here,

https://www.financialexpress.com/india-news/cbi-vs-cbi-alok-verma-moves-sc-arun-jaitley-defends-government-top-developments/1359420/

CBI chief and deputy fighting and removed is unprecedented and shocking. I am wondering if this part of the political crisis coming in 2019.

This is still a guess.

Weekending 26th October Sensex, Nifty

Last Wednesday and Thursday showed some strength but it could not be sustained after weakness returned after midday today. Over all weekly guidance was still sell which has come true.

Also TCS continues to push lower as I predicted at the begin of the week as well as begin of Month. Selling at the start of October saved me much money as I was having a bunch of TCS.

In other tips,
1.YESBank shows a sell till December. Oct 1st begin price 183.65
2. BYKE shows a buy from Oct 1st till Dec. although Nov forecast will be available at the end of Oct.
3. Another buy is STARPAPER.
4. Sell for GODREJCP and GODREJIND has gone well. Nov will be knows after Oct is over.
5. TATAMOTORS showed a reaction high today but has full sell so far.
6. Sugar stocks are at local highs. But still don't see any strong buy signal.
7. DEEPIND shows good buy but will confirm at the end of Oct.
8. HDFCBANK fell again today. I don't see anything good here and is a sell.
 

2019 Political Scenario and Stocks

2018 is almost over. I think 2019 will be the year of political chaos. Modi Govt. probably overestimates it's chances and might still be largest party but will lose the absolute majority. This will make regional parties king makers in a coalition govt and will bring chaos.

I expect some major political chaos. Not exactly sure how but general elections being in 2019 gives a good chance. We will see how it goes especially some regional elections starting in December this year e.g. in Rajasthan, MP etc.

Any weakness in political stability will transfer to Rupee as I expect rupee to depreciate more. A substantial rupee fall will help the stocks but not initially while foreigners flee.

TCS and IT stocks may stabilize by then but will get a low before that. TCS at 1400 or 1500 is a good price.

Market on Tuesday Oct 23rd. Weakness continues

As predicted before start of week, the stock market is under pressure but nowhere looks like it will collapse. We should start to see some reduction in weakness and possible strength towards end of this week.

November prediction will be available after close of October.

TCS: My Oct 1st prediction continues to be right. TCS is down hugely! It should fall even more into 1800s and possibly 1500s, we will see as it develops.

CoalIndia: I did not see any major fall in Coal India. Still do not see any major fall till december except may be some lingering weakness.

HDFCBank : Nobody expects this to fall. But I did. I expect this to fall more by december regardless what came in qtr results.

Week starting 22 Oct 2018

My Oct 1st sell predictions have gone well. We should still see weakness till December.

General sentiments in stocks have now gone somewhat bad from the overexcited highflying midcap and smallcap holders who were buying at PE 50 and expected to make more money.

I expect the coming week starting 22 Oct to begin weak but weakness to reduce by end of the week and we might see some strength towards the end and may be a little bounce. But the general guidance for the quarter till December is still sell.

First

What is next for India stocks?