The 15th loksabha has been dissolved and the scene is getting ready for the elections to be held in about 2 months’ time. The end of this loksabha would be welcomed by almost all as the government was mired in controversy about corruption on all fronts. The government would go down in history as suffering from policy paralysis and one which saw a substantial drop in the growth rate. The happenings in Parliament and the way the same was run left a lot to be desired.
The new state of Telengana has been carved out from the erstwhile Andhra Pradesh. The debate on the same was never made public as the Lok Sabha TV was not used and the entire proceedings was never broadcast. It appears even audio recording was not done. Only time will tell why such a drastic step needed to be taken for carving out a state. The first time ever use of “Pepper Spray” will always be remembered with the statehood of Telengana. The Chief Minister of Andhra Pradesh resigned following the split of the state and he has left the Congress Party as well.
It appears that the ruling Congress is all set to get the highest number of seats from the new state in the next general elections, similar to what had happened in the previous elections. The Congress had won the largest number of seats from any state from Andhra Pradesh and this time it may do so from Telengana. The difference would be that Andhra Pradesh had 42 seats of which Congress won 33 while Telengana would have just 17 seats.
The vote on account was presented to Parliament and approved. There was a pleasant surprise when excise duties on automobiles whether it be 2 wheelers or 4 wheelers or SUV’s were cut across the board. The duty cut on SUV’s is quite understandable as politicians have to campaign in the comfort of these vehicles for the election which would in all likelihood last over 6-7 weeks.
The markets have gained ground in the previous week but the volumes are poor and the open interest quite low. The present mood in the markets is still not hopeful about a clear mandate in the elections and it appears to be bordering on a hung house post election. As long as this scepticism remains, the markets will move up gradually and the volumes are likely to remain affected. Once the markets become clear about which way the results are likely to be things would change. FII flows have begun to improve and they were positive last week with net purchases of over Rs 2,000 crs.
Expiry happens on Wednesday this time as Thursday is a holiday. I am bullish on the market and believe the markets are being nicely set up for a smart rally in the coming eight weeks. Play the markets well and if you are confused or not clear, stay away from the markets bit don’t short them. All rallies begin on scepticism and short covering.
Enjoy the daily entertainment provided by political parties.
