Founder & Chief Market Strategist - SAV Markets, SAV Markets

Shyam Devani

Shyam Devani provides key market commentary encompassing analysis of Foreign Exchange, Fixed Income, Commodities, and Equities globally – both in G10 and Local Markets. He takes a multi asset class approach incorporating fundamental, behavioural, and historical trends as well as technical signals.

Shyam has delivered strategic market insights to a number of trading desks and institutional clients internationally (funds/corporates/banks) through written publications, presentations, face to face meetings and conferences. He has had numerous appearances on CNBC, Bloomberg, and Singapore Radio providing his short and medium term views on markets while being the front office media commentator during his time at Citi.

He has been commentating on financial markets since 2004. Since 2006, he was running one of Citi’s top market products, CitiFXTechnicals, initially in London followed by Singapore where he took a lead role in enhancing the coverage of markets in Asia.

Founder & Chief Market Strategist - SAV Markets

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Cross Asset Strategy

As earlier notes outlined, US yields are on the rise again, potentially in a similar fashion to 2013 before the Fed announced its tapering of asset purchases. Back then we had what was called a “taper tantrum” where many EM currencies suffered. One of the worst hit was India. Rising yields in the US would invariably create some concern for positions in EM currencies as risk-reward parameters are re-drawn. In India’s case the picture is somewhat different to 2013 but still mixed as we look at it today. We have three areas to focus:<ul>
<li>
The Good: Foreign Exchange reserves and currency stability – Reserves today are more than twice what they were in 2013
</li>
<li>
The Bad: A stretched stock market that is in danger of seeing a short term pullback
</li>
<li>
The Ugly: The major rise taking place in energy prices. Not only is Oil about to surpass the 2018 high in Rupee terms but we must also notice the sharp rise in coal prices (and natural gas) which is going to cause a difficult period ahead for many people and dent India’s recovery path, even if only temporarily.
</li>
</ul>The judgement call here is that this is not going to be a repeat of 2013 for India. The short term is concerning while the longer-term outlook may not be as bad. Watch for a pullback in in the Nifty, probably by 1,000 points, and a further slip in INR and then for signs of stabilisation and possible opportunities to re-engage.

As earlier notes outlined, US yields are on the rise again, potentially in a similar fashion to 2013 before the Fed announced its tapering of asset purchases. Back then we had what was called a “taper tantrum” where many EM currencies suffered. One of the worst hit was India. Rising yields in the US would invariably create some concern for positions in EM currencies as risk-reward parameters are re-drawn. In India’s case the picture is somewhat different to 2013 but still mixed as we look at it today. We have three areas to focus:

The Good: Foreign Exchange reserves and currency stability – Reserves today are more than twice what they were in 2013


The Bad: A stretched stock market that is in danger of seeing a short term pullback


The Ugly: The major rise taking place in energy prices. Not only is Oil about to surpass the 2018 high in Rupee terms but we must also notice the sharp rise in coal prices (and natural gas) which is going to cause a difficult period ahead for many people and dent India’s recovery path, even if only temporarily.

The judgement call here is that this is not going to be a repeat of 2013 for India. The short term is concerning while the longer-term outlook may not be as bad. Watch for a pullback in in the Nifty, probably by 1,000 points, and a further slip in INR and then for signs of stabilisation and possible opportunities to re-engage.

India: The Good, The Bad, and the Ugly