Stocks to do better, bonds, gold may lose sheen as investments: RBS
said.
On the inflation front, the report said the price index is likely to be average at 5.4 per cent in FY14 against an expected level of 7.6 per cent in FY13.
Cheruvu also pointed out that the recent measures like The partial diesel price deregulation would help in containing fiscal deficit, which will help taming inflation. Talking about investment opportunities, the report said equities and long-term bonds give better opportunities this year. It said stocks in the consumer staples, healthcare and IT are their top picks but sounded cautious on telecom, utilities and industrials space with a negative outlook.
On the rupee, the report said it is likely to appreciate against other currencies from the second half, but pegged it at 53-55 to the dollar in the near-term.
Cheruvu also said the the country is not likely to be downgraded by rating agencies from the present 'BBB-' as it has taken a slew of reform measures to contain fiscal deficit.
On the global front, the report said emerging and developing economies would do well this year with things improving in the US.
"We hope that emerging countries will do good in the current year," RBS Wealth Division Chief Investment Officer for Asia & Middle East Gary Dugan said, adding buying equities and selling bonds will be a good investment strategy this year.
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