In his latest visit to Mumbai, our regional strategist Christopher Wood (Greed & fear fame), was stressing that medium term correction in oil and related commodities has just begun and it is going to last for some more time.He expects crude price to reach levels of $90..
He expects the US dollar rally to continue with a target of 1.25 to 1.3 on the euro. There will be three key drivers of the US dollar counter-trend rally. First, other countries will start cutting interest rates in 2008. Second, leveraged speculators will be forced to cover short dollar positions. Third, the US trade deficit will continue to collapse as US consumption continues to slow. For Asia, he believes that commencement of a major correction in oil and related commodities will bring much awaited relief. It should mean sustained relative outperformance for Asia in a global emerging market context. However he still believes that Asia is yet to see the bottom of the correction. He prefers India over China in oil softening scenario. Beleives that government should maintain the current interest rate scenario, and would overkill the growth if any rate hike done from the current levels to tame inflation ... He remains underwight on Commodities, Cyclicals and interest rate sensitive stocks . Safe Harbor Statement: Some forward looking statements on projections, estimates, expectations & outlook are included to enable a better comprehension of the Company prospects. Actual results may, however, differ materially from those stated on account of factors such as changes in government regulations, tax regimes, economic developments within India and the countries within which the Company conducts its business, exchange rate and interest rate movements, impact of competing products and their pricing, product demand and supply constraints. Nothing in this article is, or should be construed as, investment advice. -- Posted By Ronald Chisley to Investor Forums at 8/21/2008 11:24:00 AM --~--~---------~--~----~------------~-------~--~----~ Logon at – http://investorline.co.in/blogs/news Learning Center- http://investorline.co.in/blogs/learning Mutual funds - http://investorline.co.in/blogs/mutualfunds Life Insurance - http://investorline.co.in/blogs/lifeinsurance Investor Journal - http://investorline.co.in/blogs/investor Latest News - http://investorline.co.in/blogger/?q=aggregator/categories/ Create your own Forum & Blog at - http://investorline.co.in/blogger To post to this group, send email to [email protected] Visit this group at-http://groups.google.com/group/investor-forums?hl=en -~----------~----~----~----~------~----~------~--~---
