Page 4 - MEX Express - Vol 5 Issue 4

www.mexnepal.com MARKET PERSPECTIVE Volume: 5 • Issue: 4 • Year: 2013 A.D

Inter market analysis • Commodity •Currency be purchased by Japanese investor then this
price action Performance investor has to buy USD ($) first to invest into
All markets are now interconnected with each other; few are closely correlated, positively or
negatively and can be experienced easily and this phenomenon was first studied and developed U.S. government Bond and this pushes the
by John Murphy.
demand of USD ($) which leads eventually
If something happens in one market then it affects another market. Simply the price of commodity
in one market affects the price of same commodity in other market. This co-relation analysis Commodity Forex to increase the values of USD ($) and this
between markets is termed as Inter market analysis. It comprises with Commodities, Forex, Bonds,
and Stocks. Regardless of time, these markets react with each other during trading locally as well increased value of USD ($) decreases the price
as globally which predict the price of certain securities or commodities.
of Gold in most of time.
Basic postulates about inter market relationship
Stock Bond In the same way, Stocks of one country can
1. Market are inter connected with each other nationally as well as internationally. be bought by foreign investor and inward flow
2. No market is isolated. •Money Flow •Rate of of money leads to gaining power to native
3. One market impact to rest of the market. in stocks Interest currency and finally affects commodity price
4. Commodities, Forex, Bond and Stock are categorized as major market. Effects again.

While analysis of commodity, Inter market Trader also analyses the forex i.e. how currencies are thought to be a hedging instrument for portfolio “In common man language, Bond market or
performing, Bond Market for rate of interest, Stock market for impact of flow of money in capital risk mitigation. The South African gold’s output Stock market affects Forex market and FX-
market and impact of worldwide market trend. throw in recent years due to numerous strikes in market affects Commodity market.” hence it
the mining production. Hence, any changes in the is always advisable that investor must keep
These three currencies Australian Dollar (AUD), Canadian Dollar (CAD), New Zealand extraction of gold ores in South Africa will impact eye over all the market to get good result in
Dollar (NZD) can be considered as major commodity price driver which move with the rate of to South African Rand. commodity trading.
commodity price in positive correlation. For example, AUD is positively correlated with Gold and
vice-versa. Australia is one of the world’s largest gold exporters that is why Australian Dollar is In today’s era, investors are highly responsive to Vikash Agrawal
strongly related to gold whereas United Kingdom is one of the biggest importers of gold for both global market, furthermore wherever opportunity Managing Director
ornamental as well as investment purposes. This gives a strong positive reason to link GBP (£) to comes, they become ready to invest. Bond can Tills Investment Pvt.Ltd.
gold price. As we know there are several gold mines in Canada because of this, (CAD) Canadian be bought by foreign investor, then he/she must Jhoche-23, Kathmandu
Dollar is positively related to gold. Japanese Yen (¥) entails positive relation with gold as gold is buy their currency first to invest into concerned
Bond which gives pressure to demand of that
currency and ultimately, it affects commodity
price. For example, U.S. government Bond can

Economy & Constitution

Historically, a rare election of the second like Nepal must adjust the gaps between the additional supply of electricity from India. For NEA has the option to expedite the contract by
constitution assembly has formed the second different sectors and segments of economy the additional supply of current there would be complying with existing legal requirements in
assembly and its newly elected members have as per its objective existence. At a time all procedure made for the change of conductors India. In that case, there would have been no
sworn their oaths before Surya Bahadur Thapa potentialities of economy should not be exploited in Kushaha (Nepal) – Kataiya (India) 132 KV delay in the project.
who enjoyed the chairmanship of assembly for the betterment of economic growth. Nepal Cross-Border Transmission line was one of Government of India has taken concrete steps
after having the confirmation of being the eldest has adopted two new markets behavior: stock the medium term measures to improve power to reduce load shedding in Nepal by supplying
member of assembly required for conducting its markets and future markets. Between the two situation in Nepal identified by an India- Nepal maximum possible electricity on the existing
first meeting. Since its first meeting, the demand markets, practice of future markets is newer Joint Team of Technical experts in November transmission lines and by helping to augment
of dissolution of the constituent assembly has than stock markets in Nepal. 2011. In July 2013 Nepal Electricity Authority cross border grid connectivity to increase this
been raised by CPN-Maoist led 33 party’s front, (NEA) had requested Government of India’s quantum up to 250 MWs. ‘
claiming they were forcefully set outside from Naturally, the regulations and regulatory consent to re-conduct the Indian portion of Issue of supplying electricity is an imperative
the election even though they were the major agencies are also newer than other countries transmission line also through a Nepalese task for the government. This shows negligence
stakeholders of the constituent assembly. of the world. In India recently the discussion contractor. of authority performed by official. Such activities
of merger of regulatory bodies of the two should be taken seriously for the economy.
Constitutionally Nepal has been declared as markets has begun. Indian experiences shall be But the procedural documents were not
Federal Republican state but oppositions have better than other markets because Indo-Nepal submitted to the channels of Indian government What are the imperatives and potentialities of
been seen in constituent assembly opposing societies have been sharing common culture on time according to the Embassy of India. exploitation of resources should be prioritizing
Federal Republican State. Though composition and nature of behaviors. Nature of these two In this concern India has clarified by issuing first. Infrastructure sectors should be given
of assembly still favors pro Federal Republican markets mainly depends on regular supply of press release saying that the conductors and its priority. Policy makers and law makers should
forces that only lifts the confidence of electric current updating technology based accessories which would be installed and retained take care of such behaviors preserving national
promulgating constitution on due time otherwise data and information for operating market in India and also the tools and equipment which sovereignty.
no one expecting that assembly will produce a based businesses. It all depends on regular would be temporarily imported for execution
strong constitution for the country. supply of electric current but Nepal has been of work are of third country origin. The release Major issues of constituent assembly are
facing the scarcity of electricity although the read further ‘Article III of the Agreement of the distribution of natural resources and its
On the other hand all expectations are seen potentiality of production of electricity is high Co-operation to Control of Unauthorized Trade exploitation. All stake holders should pave the
saying to pave away that leads sustainable and in the country. Hydro-power projects have between Nepal and India prohibits re-exports way of economic growth filling the gap between
durable growth earning economy. been lagging behind the supply of electricity. of third country goods without manufacturing have and have-nots.
Government officials have widely criticized and activity from one country to another. NEA
Technology based economy has been galloping political leaders have been blamed of ignoring has been informed that the Embassy has also Dharmendra Karna
and swallowing employments in order to produce people’s interest instead of falling in the rubbish separately taken up this matter with relevant
strong Gross Domestic Production(GDP) and of corruption. Hydro power projects should be Indian Ministries for a one-time waiver. Central Member
enhance a way of benefiting more profits for integrated with irrigation receiving maximum Federation of Nepal
the richest of the world as recently Oxfam has utility of such projects. Policy makers should Journalist (FNJ)
mentioned in its report recently released ahead be alert granting permission for hydro power
of World Economic Forum. The report of Oxfam projects and monitoring over given permissions.
is not to be considered only for the leaders of Without power supply Nepal can’t change its
powerful countries and emerging countries fate of poverty. The economic policy as whole
but also for the least developing countries like depends on strong constitution but imperatives
Nepal that are to stand against poverty in the should be fulfilled by the governments. Many
21st century . say that extreme scarcity of electricity can be
moderated by requesting India. Possibly what
For the leaders of constituent assembly also extent of electricity can be borrowed from India
such reports are important because they are that much should be brought immediately, but
to prepare economic policy sustainable and the delay of government officials has been
durable for at least 50 years or more to come. seen in this regard. According to Madheshvani
Indeed not only Nepal, no country can exists Weekly, 10 January, the government officials
without development of technology but country had delayed forwarding procedure required of

Editorial Board: Lakshman Pandit / Liberty Shakya / Sharad Koirala / Shubhechchha Mulepati Page 04
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