{"id":1078,"date":"2019-09-20T09:47:38","date_gmt":"2019-09-20T09:47:38","guid":{"rendered":"http:\/\/myassetsconsolidation.com\/blog\/?p=1078"},"modified":"2019-09-20T09:49:08","modified_gmt":"2019-09-20T09:49:08","slug":"market-spike","status":"publish","type":"post","link":"https:\/\/myassetsconsolidation.com\/blog\/market-spike\/","title":{"rendered":"MARKET SPIKE"},"content":{"rendered":"

What does the market spike mean?<\/strong><\/p>\n

On Aug 13, when the whole market was pessimistic, I stuck my neck
\nout and said the market will look up before Diwali, what with a good
\nmonsoon and a few good reforms initiated by the government.
\nI have been proved right today. The market zoomed 1900 points
\ntoday and there has been a lot of improvement in your portfolios. In
\nthe past few weeks, we saw that the automobile sector was
\nbleeding. But today, the auto sector zoomed 8.5%, possibly a record
\nin a decade.
\nThe market jumped because Finance Minister Nirmala Sitaraman cut
\ncorporate tax, ensuring a far better structure than in other countries.
\nAlthough the government may lose revenue of Rs 1.45 lakh crore,
\nrenewed activity across industry is likely to offset the revenue loss.
\nMoreover, the recent RBI payout of Rs 1.76 lakh crore will cushion
\nthe market. With inflation under check, RBI may go in for one more
\nrate cut. That will, in turn, reduce the borrowing cost for individual
\nborrowers as well as corporates.<\/p>\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n
COUNTRY<\/strong><\/td>\nCORPORATE TAX RATE\u00a0 (%<\/strong>)<\/td>\n<\/tr>\n
SINGAPORE<\/td>\n17%<\/td>\n<\/tr>\n
UK<\/td>\n19%<\/td>\n<\/tr>\n
RUSSIA<\/td>\n20%<\/td>\n<\/tr>\n
VIETNAM<\/td>\n20%<\/td>\n<\/tr>\n
USA<\/td>\n21%<\/td>\n<\/tr>\n
CHINA<\/td>\n25%<\/td>\n<\/tr>\n
INDONESIA<\/td>\n25%<\/td>\n<\/tr>\n
INDIA<\/td>\n25.20%<\/td>\n<\/tr>\n
GERMANY<\/td>\n30%<\/td>\n<\/tr>\n
JAPAN<\/td>\n30.90%<\/td>\n<\/tr>\n
BRAZIL<\/td>\n34%<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n

Will the market look up?<\/strong><\/p>\n

For an economy to grow, there should be two elements: lender and
\nborrower. For a year, bank deposits have been growing but the
\ncredit off-take was low.
\nIn July this year, the credit-to-deposit ratio was 76.51% versus
\n74.735% in 2018. This means, people have started to borrow.
\nHowever, with Non-Banking Financial Companies in doldrums, the
\ncredit off-take for auto, consumer durables and housing reduced
\ndrastically in the one year. That impacted the economy. Now, the
\ngovernment is planning to push credit in 400 districts through public
\nsector banks but support NBFCs with credit. With the new initiative,
\nNBFCs will be able to lend Rs 32,000 crore. This will kick-start the
\neconomy in the coming festival season and in the upcoming harvest
\nseason, which is few months away.
\nAlong with the slew of measures announced today, if some cut in
\nGST is provided, it will boost the sagging economy.<\/p>\n

Should you start investing now?<\/strong><\/p>\n

No. Any push will require time at the ground for any reaction. The
\nmarket may not rally daily once the initial euphoria dies down. Only
\nafter the speculators calm down will there be a change. Spread your
\ninvestments. Multicap and mid-caps will benefit from the latest
\nannouncements in the runup to Diwali. So, here\u2019s spreading light
\nand good cheer. Happy Diwali in advance!<\/p>\n","protected":false},"excerpt":{"rendered":"

What does the market spike mean? On Aug 13, when the whole market was pessimistic, I stuck my neck out [\u2026]<\/span><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":[],"categories":[3,1],"tags":[],"yst_prominent_words":[337,338,325,329,327,334,294,330,328,331,63,326,335,47,340,339,333,332,269,336],"_links":{"self":[{"href":"https:\/\/myassetsconsolidation.com\/blog\/wp-json\/wp\/v2\/posts\/1078"}],"collection":[{"href":"https:\/\/myassetsconsolidation.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/myassetsconsolidation.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/myassetsconsolidation.com\/blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/myassetsconsolidation.com\/blog\/wp-json\/wp\/v2\/comments?post=1078"}],"version-history":[{"count":2,"href":"https:\/\/myassetsconsolidation.com\/blog\/wp-json\/wp\/v2\/posts\/1078\/revisions"}],"predecessor-version":[{"id":1080,"href":"https:\/\/myassetsconsolidation.com\/blog\/wp-json\/wp\/v2\/posts\/1078\/revisions\/1080"}],"wp:attachment":[{"href":"https:\/\/myassetsconsolidation.com\/blog\/wp-json\/wp\/v2\/media?parent=1078"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/myassetsconsolidation.com\/blog\/wp-json\/wp\/v2\/categories?post=1078"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/myassetsconsolidation.com\/blog\/wp-json\/wp\/v2\/tags?post=1078"},{"taxonomy":"yst_prominent_words","embeddable":true,"href":"https:\/\/myassetsconsolidation.com\/blog\/wp-json\/wp\/v2\/yst_prominent_words?post=1078"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}