India : Sensex gains over 100 pts, Nifty firm; Reliance up 2%

Taking his critics head-on, RBI Governor Raghuram Rajan has challenged them to show how inflation is “very low” before accusing him of “being behind the curve” in his focus on containing price rise than on growth and debunked such criticism as mere ‘dialogues’. Rajan, who has often been seen as being critical of the government and its policies, also said there is “lot of frustration” about the pace of economic recovery, but attributed it to the two successive droughts, weak global economy and external shocks like Brexit. Given these constraints, performance of Indian economy has been “quite creditable” and prospects of good monsoon as well as structural reforms and macroeconomic stability will accelerate the growth going forward, he added.

FMCG major Hindustan Unilever (HUL) announces its first quarter earnings on July 18, but analysts do not expect any fireworks due to muted urban and rural demand. Profit is expected to increase 10 percent year-on-year to Rs 1,156 crore on margin expansion, according to average of estimates of analysts polled by CNBC-TV18. Revenue is seen rising 5.6 percent to Rs 8,557 crore in the quarter ended June 2016 from Rs 8,105 crore in year-ago period with volume growth around 4.5-5.5 percent. Gross margin is likely to be at around 52.5-53 percent for the quarter but expansion may taper going ahead as commodity prices are bottoming out. According to analysts, benefits from monsoon & 7th Pay Commission may be seen October 2016 onwards.

Betting that the liquidity rush will continue in the short term, Geoff Lewis of Manulife Asset Management expects the US economy to pick up in the second half on the year. Strong jobs data is keeping the US markets in a good shape, he told CNBC-TV18.Lewis, however, said that he doesn’t expect an interest rate hike by the US Federal Reserve until December. A rate hike in September would come too close to the US Presidential election in November, he said.

Lewis said he’s bullish on emerging markets with strong domestic growth. In Asia, his picks include India, Indonesia and Philippines.