Tuesday, May 3, 2011

Trading the Globe: India May Hold Opportunities

Emerging Money submits:

By Tim Seymour

The Indian stock market has gone from last year's record peaks to become the worst performer in the BRIC group. Is this a buying opportunity or a broken economy?

India's central bank raised interest rates today for the ninth time in a year in a desperate effort to combat inflation that it predicts will stay around 9% for the rest of the year.

Thanks to the rate hike fever, the Mumbai stock market has been the slumping to the point where it could easily become a buying opportunity some time soon ? just not today.

The issue is that the governor of the Reserve Bank of India remains extremely outspoken about fighting the country's inflation problems. In that light, today's 50 basis-point rate hike was not a huge shock, but it starts to raise questions about just how high rates can go before inflation stops rising.

We


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