THE TRIGGERS FOR NOVEMBER - ALL ON HOLD TILL 8TH

By Ruma Dubey

So the festivity is all over. We are back to the markets, looking around for new triggers.

Many of us might have done some very good bit of shopping during Diwali, some heavy buying of big stuff and we now hope that this reflects in the Q3 numbers. Automobile companies will declare their sales numbers for October and we surely hope that it has been a bumper month – at least that is what the festivity and 7^th Pay Commission meant to all of us.

This is going to be a newsy week in that sense. In India, there is nothing really specific – apart from the IIP data for September’16 scheduled for 11^th November and the Q3FY17 GDP numbers on 30^th November. There is no RBI meet this month – it will only happen on 7^th December. Thus for us here in India, it will be Q3 numbers and unscheduled events which will dictate the moods for the month but world events are what will dictate the moods.

This is a HUGE month as far as international events are concerned. Next Tuesday, 8^th November, it is going to be the US Presidential election date – the day USA goes to polls to elect their new leader. This is a world event as whatever happens in USA, affects the whole world. Thus till the new President is declared, virtually everything other decision, all around the world will be kept on a hold.

And we saw an example of this today itself. Bank of Japan kept policy/interest rates on hold for November, ending speculation that Japan was all set to announce a slew of stimulus. But it did set the stage for probable stimulus in the coming months as it revised down its inflation forecasts Tuesday following a raft of poor data. Economists say the ball is now in the court of Prime Minister Shinzo Abe’s administration.

Tomorrow, 11.30 India time to be more precise is that US Fed interest rate meet. With elections less than a week away, it is unlikely that any decision will be taken – it will be another “hold” meet. But the world markets will most certainly anchor around the meet, despite knowing the outcome.

Thursday, UK will announce its decision on its interest rate and once again, given the background of Brexit, it is a crucial decision. Once again, it is likely to keep rates on hold till US elections are over and done with.

Yes, end of the month, 30^th November is the OPEC meet in Vienna, Austria. Don’t hold your breath as the meet in Algeria has already indicated that no production cuts might be announced. Prices are expected to hover around $40/barrel but be sure to see a lot of speculative ups and downs during the last week of November.

Thus till US elections are over, just concentrate on specific company results for Q2FY17; that will dictate the moods. It will be wait and watch as the world’s largest economy goes to polls.