By Ruma Dubey

So the markets are today in a consolidation mode. Its good because moving only one way is not a good thing; we need to see the down’s to appreciate the up’s.

We can now say that the elections are truly behind us and we now await specific triggers. And there are indeed many things to look forward to.

First and foremost will be 26^th May – we do not know the exact time but that’s the day when Modi will be sworn in as the new PM and we will the key Cabinet ministers also being sworn in. There is major speculation about who will get what. Currently the finance minister is a tough choice between Arun Jaitley and Arun Shourie. In fact Shourie is being tipped for Commerce and Industry too. Sushama Swaraj is said to be keen for External Affairs or Defence but many say she could be chosen for HRD or health.  Rajnath Singh is being tipped for Home. Modi is also said to be considering a leaner Ministry. There is also talk of formation of a Ministry for Rivers being talked about. Speculation is rife and no one really knows, at this juncture about who will be placed where. Thus this placement, when announced, is sure to generate of a lot of excitement and we can most certainly expect the market to react with a jump.

But the real big jump, which could be bigger than the current Exit Poll surge is that Union Budget. Though no date has been announced, it is widely rumoured to be held before 15^th of July. If today stocks are hitting new highs, based on the manifesto, one can only imagine the newer highs when sops actually get announced. The Budget will in many ways personify all that which Modi promised – it will be the first policy to see whether Modi will walk the talk. Expected to be pro-market, the pre-Budget, Budget and post-Budget is sure to send the markets into a tizzy.

These will be the two immediate big events. Then there are the scheduled dates for economic announcements (Check the Free Zone on our site for the dates). More than the IIP or Q4 GDP, all eyes will be on first on the RBI Policy on 2nd June. The CPI will come later, on 12^th June.

Over-riding all these events is the monsoon God. The IMD has already said that we might see rain deficiency but because we had good rains in 2013, the reservoirs are full and the country can bear upto 15% rain deficiency. Anything above that will cause trouble. And despite the reservoir situation, fields ploughed by the farmers need rains and if that gets affected, there is bound to be trouble. One can expect CPI to only increase.  The IMD has said that rains will hit Kerala by 4^th June; usually it is 1^st June. Thus the onset of monsoon is sure to affect the market moods. And this is something which even Narendra Modi does not have a control on.

As we said, action packed few days and as always, best to remain sane and not get swept away by this wave; small boats will get drowned while big cruise liners will sail through.  Cannot help but fully agree with what Sir John Templeton says, “Bull markets are born on pessimism, grown on skepticism, mature on optimism and die on euphoria. The time of maximum pessimism is the best time to buy, and the time of maximum optimism is the best time to sell.”