A couple of years ago, I had written a column titled ‘Right Now’, which was the title of a popular rock song released three decades ago by the music group, Van Halen. The lyrics of this song proposed living for the moment and not being afraid of making a change. So, in this fortnight’s column, I propose to take you, my valued readers, on a Merry-go-Round ride …. ‘Right Now’ across our financial markets.
Right now, the dust seems to be settling on the Union Budget, which too as its predecessors arrived amidst the high din, was debated threadbare thereafter by ‘talking heads’ and then, seems to be fading away from public memory just as quickly.
Right now, the government disinvestment target for the fiscal has been lowered since last year, but still remains ambitious, though no target is ever beyond the realm of possibility. So, what are the chances of it being met to support the mathematics of the budget?
Right now, given the uncertainty floating around, the Indian equity market appears shaky and vulnerable. Market participants of all hues and varieties, including Big Bears, Bulls and Bigger Fools (not mutually exclusive always) are straining themselves trying to justify their market biases. So, is a deep correction around the corner or will the indices simply pause and resume their upward journey?
Right now, the Hindenberg report on the Adani group is still ticking away like a time bomb that has proven difficult for it to defuse in spite of multiple pitches to try and douse the fire.
The group was forced to call off its ambitious mega FPO and from the looks of it, the ripple effect it has had across the stock market has dented the confidence of several participants and more specifically, later entrants. Selective topping up some of one’s diversified mutual fund holdings might not be a bad idea for those that believe like I do, that sunlight eventually follows darkness in the equity market.
Right now, there is a flight back to the safe haven of Fixed Deposits with the rates racing past 7%. While these rates might be a good opportunity for those who are senior citizens or those out of the tax bracket, for the rest, it might be smart to first do a back-of-the-envelope net of inflation and tax calculation before taking a long-term plunge.
Right now, there are seasoned market participants doing more than hedging their equity bets with gold. The price of the precious yellow metal surged post the Ukraine war and retains its froth for now. And, if the equity markets were to slip sharply, can there be a further uptick in gold prices? Depending on one’s answer to this question, one could either top up or simply sit back and let the growth in value happen on its own sans the deployment of further capital.
Right now, stay focused on rebalancing your asset allocation and then, like the lyrics of the song this column has been based on suggest, not be afraid of change.
Ashok Kumar
Head of LKW-India. He can be reached at ceolotus@hotmail.com