By Ruma Dubey

As we are getting ready to step into the New Year, there is hope and trepidation – will 2014 be better than 2013 or could it take a turn for the worse?

The future is an unknown factor of our lives so what is the point fretting over something which is unknown or on which we have no control? Yes, what we can surely do is look logically at how things could pan out in 2014 and what are the factors that could make the year better or worse. Once again, we can only draw an inference based on facts.  And this is purely from the stock market point of view …..

1: America is showing signs of recovery and once its economy bounces back, despite the QE tapering, we will do just fine as business prospects, which had come down to a trickle will now bounce back.

2: We have the great Indian political election in 2014 and having a stable Govt at the Center is imperative for the economy and country. Any new Govt comes into power, surely there will be a flurry of infra push and new reforms will be announced. This in itself will help boost sentiments.

3: Inflation is like a puzzle with no solution – we could analyze reasons for a fall or a rise but no one really seems to be truly in control of this rogue. RBI will thus continue to monitor this and interest rates do not see poised to come down any time soon.

4: The ground reality is that overall mood has turned from pessimism last year to optimism this time around. A new hope has come that things are changing for the better now – we see light at the end of this dark tunnel. And this improvement in sentiments is a major game changer as it is sentiments which percolate down to the investment climate in the country.  If man achcha, sab achcha.

5: Industry body Assocham has said that IT, banking and agriculture-related businesses like farm equipment, fertilizers and seeds are going to be among the key job creating sectors in 2014. And particularly in banking, it expects NPAs to come down and there are signs of some recovery in some segments of the economy.

6: New banking licenses will be issued and it would be an exciting phase to see how these new banks set up shop and make themselves ‘different’ in terms of services already being offered by the existing banks. Yes, thanks to competition, existing banks could get more efficient.

7: As soon as we enter into the New Year, Budget expectations start appearing all around. And talking about the election year, as mentioned earlier, there is no way in which the Finance Minister can afford to present an unfriendly Budget.  So Union Budget for fiscal 2014-15 will be more politically motivated than economically. Now that sounds very promising, if you are an investor, but scary if you are an economist.

8: The sectors which are expected to do very well in 2014 are – capital goods, construction & contracting, infrastructure, IT, power, entertainment, realty and banking & finance.

9: CII has stated in its report that the slowdown in the domestic economy may have bottomed out in the second quarter and the trend could reverse henceforth.  Thus all signs pointing to a recovery.

10: Hope is what keeps mankind alive. So let’s hope that 2014 will be much better than 2013 and will bring in more peace and prosperity. The glass should always be half full. Nothing in life could be more promising than this!