Decoupling theory again

Our idea of Indian outperformance comes from comparing the S&P500, which is a dollar-denominated index, to the Nifty or Sensex, which are rupee-denominated indices

Buffeted by bad news since late last year, global markets had been falling more less in sync right until mid-June this year. Around June 17, markets around the world made a short-term bottom and rallied fast, right until mid-August. During these two months, the Nifty rose from 15,319 on June 17 to 17,980 on August 18, a rise of 17.7 per cent. At the same time the S&P500, the leading US index, also went up 17.7 per cent. There was no surprise here. Global markets usually move up and down in sync, in response to global macro news. But what