2010 could be unpredictable, but here are our thoughts!
If we were to base our view on the study above ad the indicators prevailing in the economy globally and in India today the equity market could at the end of this year 2010 give returns similar to the year 2004 (refer the table above) and the rationale behind this is:
Firstly, fixed income markets are in a territory which could deliver 4-5% returns for better part of 2010 and the longer end of the curve could rise further. That means any hope of a fast revival of the real estate market could only remain a hope. Gold, we believe could take a breather in 2010 with very modest gains as compared with roaring performance seen in the last 3 years (unless the west cracks badly). Equities could therefore be amongst the better performing asset classes on the back of continuing cost prudency by corporates, ample liquidity despite tightening and improving consumer satisfaction and therefore base. But beyond 2010, there should be a tough fight between equities and fixed income.