The Indian economy will grow by as much as 8.75% in the coming fiscal year, the country's finance ministry predicted on Thursday. But concerns about inflation and a growing deficit have some analysts worried.
The annual Economic Survey released in parliament yesterday (Thursday), one of New Delhi's most important policy documents, said Asia's third largest economy will return to a high rate of growth as it stages a "remarkable recovery" from the global recession. Economic growth this year is estimated at about 7.5%.
The comprehensive annual assessment of India's economic performance was released a day before the government is scheduled to reveal its national budget, which is widely expected to outline policy changes to wind down fiscal stimulus measures and reduce the country's worst deficit in 20 years.
Despite India's Optimism, There May Be a Better Time to Buy
The Indian government announced Monday that the country's economy was expected to expand by 7.2% during the fiscal year that ends next month.
Agriculture - which had been expected to be a major drag on the economy because of a poor monsoon season - contracted a mere 0.2%. That is a truly stellar performance, showing that India - like China - has emerged almost unscathed from the global economic meltdown. It would pretty well justify the Bombay Stock Exchange Ltd.'s rich Price/Earnings multiple of 20 and would make Indian stocks a "Buy" even at these levels.
Unfortunately, when looked at closely, the picture is not quite so rosy.
Is India a "Buy" now -- or later? Read on to find out...
How to Profit in Any Kind of Market
When it comes to the global financial crisis, many so-called "experts" think the worst is behind us. But I don't buy it.
And I'm not alone.
Just look at what some other big-name investors - each also known for their independent thinking - are saying or doing right now:
- Bond king Bill Gross is nervous and raising cash.
- Author, commentator and global-markets guru Jim Rogers has repeatedly said that he's not investing in stocks anywhere in the world right now.
- Hedge-fund heavyweight John Paulson is moving aggressively into gold.
- And investing icon Warren Buffett - never one known for tipping his hand - is candidly stating that the U.S. financial-crisis cleanup is far from complete. The fact that he's reportedly buying more shares of Korean steel dynamo Posco (NYSE ADR: PKX) would punctuate this point.
This kind of uncertainty can be paralyzing, making it tough to decide where - or even if - we should deploy our investments.
Fortunately, we've been here before. And what we learned will allow us to profit no matter what the financial future holds for the U.S. marketplace.
To learn the four secrets to investing success, please read on...
- Bond king Bill Gross is nervous and raising cash.
Two Ways to Profit From Wall Street's "Soft Commodity" – Cotton
Some of the best investment opportunities can happen simply by ignoring the Wall Street herd and venturing onto the road less traveled.
Take such traditional "breakfast club" commodities as sugar, cocoa, coffee and orange juice. They all enjoyed a great year, despite bearish forecasts of doom and gloom. Sugar and cocoa even traded at multi-decade highs.
Similarly, cotton got a bad rap going into 2009, though it motored into the end of the year with a tidy profit, rising on the standard laws of supply and demand.
Asia's Economic Recovery Gathering Steam with China at the Helm
Manufacturing data today (Monday) confirmed that Asia's economic recovery is gaining strength, and China - whose economy may have expanded at a rate of 9.5% in the fourth quarter - is leading the revival.
The China Federation of Logistics and Purchasing on Sunday said the country's official purchasing managers' index (PMI) rose to 55.2 in December from 54.3 a month earlier. That's the biggest increase since April 2008, and it was aided by an increase in trade. The gauge of export orders rose to 54.5 and the reading for imports climbed to 52.8.
Similarly, the China Manufacturing PMI produced by HSBC Holdings PLC (NYSE ADR: HBC) and Markit Economics jumped from 55.7 to 56.1 last month. The index's average monthly increase in the fourth quarter was the largest on record.
Economists point to these numbers as further evidence of a robust recovery for China's economy, which grew at an 8.9% annualized pace in the third quarter.
Investment News Briefs
With our investment news briefs, Money Morning provides investors with a quick overview of the most important investing news stories from all around the world. IMF to Raise Global Growth Forecast; CIC Investing $1 Billion in Oaktree; Yen Highest in Eight Months; Bombardier JV Wins China Contract; World Bank President Wary of Fed's Power; Trichet: [...]
G-20 Reaches Agreement on Restructuring Economic Policy and Banking Rules
The G-20 summit in Pittsburgh concluded Friday with agreements to restructure policies to sustain the economic recovery and to install new banking regulations to prevent a repeat of the biggest financial meltdown since the Great Depression. Also, the G-20 announced that it would become the permanent council for international economic cooperation, eclipsing the G7 and [...]
Buy, Sell or Hold: The SPDR Gold Trust ETF (NYSE: GLD) Continues to Offer Investors a Hedge Against Inflation
The just-concluded Group 20 (G20) meeting left us with a chorus of very "prudent" governments and central bankers singing the praises of easy monetary and fiscal conditions. So where can we take refuge when all the central banks in the world print money and governments run deficits in order to spend like drunken sailors? The [...]
Indiaâ€™s Nuclear â€śExplosionâ€ť a Cash Generator for Global Energy Companies
By Jason Simpkins Managing EditorMoney Morning After being locked out of global nuclear trade for more than three decades, India is looking to lock up some major energy deals. Large global energy companies are lining up in droves to make sure that happens. India launched its first nuclear test in 1974, but the country refused [...]