Investors cheer cheap crude oil-fuelled rally on street – Silver Charm Necklaces Manufacturer

Expectations among investors that European officials and thecentral bank would spring into action to tackle the region”sdebt crisis have led to a sharp rally in risky assets. In India,investors are now hoping for a 25-basis point cut in policy rateson June 18 as a sharp decline in crude oil prices has given moreelbow room to the central bank for further easing. Thegovernment”s initiative to push infrastructure projects hasalso boosted the sentiment. Opinion is divided if the rally would be sustained but expertsbelieve valuations are reasonable and investors can startaccumulating shares. “Time teaches us the most money is madeon stocks not when the macroeconomic situation is great or theconviction in profit growth is high but when equity valuations areinexpensive,” said Ridham Desai, strategist and head of Indiaequity research at Morgan Stanley.( Click here for charts ) “With the one-year forward price-to-earnings (PE) multiple atabout 11, the markets are looking attractive. Female Body Piercing Jewelry

Historically, marketshave gained sharply from such low PE levels. As the domesticsituation is bad, we were overreacting to European problems,”said G Chokkalingam, executive director and chief investment officer atCentrum Wealth Management. The 30-share Sensex on Thursday gained 1.2 per cent to end at16,649.05, while the Nifty rose 1.05 per cent to close at 5,049.65,its highest level since May 7. In a surprise move, China slashed its benchmark interest rates 25basis points for the first time since 2008 to boost economicgrowth. Silver Charm Necklaces Manufacturer

The news, which came after the Indian markets had closed,saw most global markets gaining and the euro rising above 1.26 tothe dollar. Anand Shah, CIO, BNP Paribas Mutual Fund, said, “Given theglobal issues, it is difficult to say if markets have bottomed out.But, I can say with reasonable confidence we are close to thebottom and the markets are poised for strong returns overthree-five years.” The markets had dropped 13 per cent fromtheir February highs due to a worsening macroeconomic situation,policy inaction and a weak global environment. However, with Brent crude prices declining 15 per cent since Mayand the rupee regaining some of the lost ground, things arebeginning to look better. Morgan Stanley believes thoughIndia”s macroeconomic situation is fragile and there is lowconviction in the growth of corporate profitability, the Sensexcould touch 20,000 by December. China Engagement Ring and Wedding Ring Sets

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