Respected Members,

Growth is never by mere chance; it is the result of forces working together.

India was the best place for investment last year. The majority of emerging market funds is overweight. With China rallying and a bear market rally, commodity exporting countries' investors have been forced to re-balance resulting in forced selling of India. This is the major reason why markets have been struggling for the past six weeks. In mid-March, the dollar index briefly moved above the 100 mark, but it failed to maintain the momentum. This was partly a function of US economic weakness. Crude oil prices made lows in the beginning of the year and a higher low coincidental with the dollar reversal. And this started a rotation of trades out of long dollar, long Europe, Korean tech and India. The money rotated into the stressed Brazilian currency. I am optimistic about India. It is forecast that India will be a fastest growing major economy. High relative growth and reforms support the bull market. J.P. Morgan continues to advise clients be overweight on India.

Office Bearers
CIRC Newsletter-July 2015

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