- Election results
How are the Indian and global economic environments affecting the financial markets?
Elections gave a resounding victory to prime minister Modi, surprisingly a bigger win than in 2014 amid farmer distress, youth unemployment, high income inequality, a stressed and corrupt financial system inherited from his Congress predecessor’s years, and the promise of a basic income for 50 million of the country’s poorest families by the Congress. This shows the lack of leadership depth in Indian politics, a big political risk, as the people flocked to Modi and picked the devil they know no matter the promises of the discredited Sonia and Rahul Gandhi’s Congress in the 2014 election. Looking at the glass half full, Modi’s economic performance since 2014 has certainly been better than that of his Congress predecessor and it has been anything but anemic. The markets have cheered Modi’s victory and it can only be hoped that the economic issues outlined here get addressed and an agenda for not merely the next 5 years but the next 30 can be put into place if India, a democracy, is to develop as well as China, an authoritarian regime, has done in the past 30. Modi sees himself, after all, as a prime minister dedicated to India’s development.
What to expect from the markets next week?
Foreign Institutional Investment (FII) is continuing to push the markets up. Should oil price rise, it would put pressure on the rupee.