01. Divergent consumption trend.
Divergence generally means two things are moving apart while convergence implies that two forces are moving together. In the world of economics, finance, and trading, divergence and convergence are terms used to describe the directional relationship of two trends, prices, or indicators. Divergence is when the price of an asset is moving in the opposite direction of a technical indicator, such as an oscillator, or is moving contrary to other data. Divergence warns that the current price trend may be weakening, and in some cases may lead to the price changing direction.
02. Bond Equity Earnings Yield
Ratio (BEER)
BEER has two
parts—the numerator is represented by a benchmark bond yield, such as a five-
or 10-year Treasury, while the denominator is the current earnings
yield of a stock benchmark, such as the S&P 500.
A comparison of the yield on
long-term government debt and the average yield on an equity market
benchmark can be used as a form of indicator on when to buy stocks. If the
ratio is above 1.0 the stock market is said to be overvalued; a reading of less
than 1.0 indicates the stock market is undervalued.
03. Real yield curve
The real
yield curve is computed as the difference between the nominal yield
curve and the implied inflation rates. Forward real interest rates could therefore be
derived from the real yield curve.
A real
interest rate is an interest rate that has been adjusted to remove the effects of
inflation. Once adjusted, it reflects the real cost of
funds to a borrower and the real yield to a lender or to an investor. A real
interest rate reflects the rate of time preference for current goods over
future goods
04. Wage growth
Wage
growth (real wage growth) is a rise of wage adjusted for
inflations, often expressed in percentage. In macroeconomics, wage growth is one of the
main indications to measure economic growth for a long-term since it reflects
the consumer's purchasing power in the economy as well as the level of living
standards
05. Fiscal deficit.
The
difference between total revenue and total expenditure of the government is termed as fiscal deficit. It is an indication of the
total borrowings needed by the government. While calculating the total revenue,
borrowings are not included.
06. Current Account deficit.
Current
account deficit (CAD) is when the value of a country's imports of
goods and services is greater than its exports. CAD and fiscal deficit together make up twin
deficits that can impact the stock market and investors. Fiscal Deficit is the
gap between the government's expenditure requirements and its receipts.
07. Weighted average lending rate
A
weighted average interest rate is an average that is adjusted to
reflect the contribution of each loan to the total debt. The weighted average multiplies each loan's
interest rate by the loan balance and divides the sum by the total loan balance.
08. Non food credit growth
The bank
credit is categorized into food credit and non-food credit. The food credit
indicates the lending made by banks to the Food Corporation of India (FCI)
mainly for procuring foodgrains. It is a small share of the total bank credit
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