Is the equity market running ahead of economic fundamentals?
Even before exit-poll numbers are announced, let alone the final election results, BSE Sensex shot up by 650 points to enter into unchartered territory. It was normal to hear market chatter while travelling by mumbai locals on a day the market touched a new high. Queries doing the rounds are - Has the party already begun? Can the Sensex cross 25,000 on the day of the results? Is it too late to enter the market now?
If one thought that only gullible retail investors generally turn euphoric around such events, think again. Credit Suisse conducted a survey of 118 fund managers who are betting on India from across the globe on Indian market strategy. More than 70 per cent of the fund managers believe that the Narendra Modi led government would drive an earnings turnaround within a year. While the retail investors travelling by train in Mumbai have a perception that things will improve once a new government comes in, ...
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