So do we think this rally will end here ?
We do not know if this will be the case. Indian markets have materially outperformed, emerging market returns YTD. But this has happened repeatedly in the recent past.
We are concerned that the Indian market has moved up too much too fast. But we believe resistance is futile. It is extremely unusual for a market’s rally to fizzle out so soon. The average bull market in India lasts for 53 weeks. In a world beset with an ever-increasing speed of response, such moves might be shrunk and play out over shorter periods. But 12-14 weeks is just too short a time for a market rally to end according to the above data.
Ya, I know it is extremely confusing as earnings don’t justify the market levels yet.