Quick edit: A sub $90 pricing for crude oil. Just what the deficit warriors ordered. The trajectory of India’s economic recovery is set to change. The turnaround moment in India’s economic battles could be just now. If oil prices stay soft, we could definitely see inflation thaw, deficits narrow, business margins expand, industry regain momentum and growth return with a bang. So, the earnings numbers on which we anchor valuations will see swift upgrades. Soft commodity prices will be the plank on which India’s economic recovery will be built on. This is ironic given that the Bull run that happened just six years ago was completely built on raging commodities. This only goes to show how Indian business has adapted itself, moved up the value chain and anchored itself to the future. Markets are always smarter and adept at change. When business confidence and market confidence converge, the foundation of a long term bull market will be firmly laid. One senses that moment is near.
“Timidity prompted by past failures causes investors to miss the most important bull markets.”