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Bombay's Melt Up

|Includes: EPI, HXI, India Fund (IFN)

The Congress Party won an upset victory in national elections, its coalition taking 262 out of 543 seats, paving the way for much needed economic reforms. At the top of the list is a liberalization of foreign investment restrictions, which will unleash torrent liquidity into the stock market. After two limit up moves took the Bombay Sensex ($BSE) up 17%, exchange officials shut down the market. This “melt up” is a great “tell” for global capital markets as it shows you the tremendous extend of the latent buying of high growth emerging markets that is out there. This is a theme that I have been hammering away on all year, and will continue to do so until I cash in my chips.