When a storm hits, it spares no one. The storm will sweep the winners and the losers, the good and the bad. India is touted as the bright spot in an otherwise recessionary world economy. It may be hard to stay immune to a global storm. Yet, there could be pockets in India that could …
If you plot a chart of the S&P BSE Sensex and the Bankex, an index that tracks the banking sector stocks, you will find a linear correlation for most of history. Things have changed a bit since the start of 2022. The Bankex has outperformed the Sensex significantly till now. That is despite financial services …
How to play India’s banks as interest rates rise Read More »
The year 2022 brought turmoil to financial markets. Rising interest rates and inflation took the wind out of equity prices. Major indices in the US, Europe and Asia shed 20-30% since January 2022. India stood out, though. Shares held their ground even as foreigners sold off due to the ‘risk off’ strategy. As the chart …
Sam Bankman-Fried, the founder of FTX, wants to set things right after the company’s spectacular collapse of a cryptocurrency exchange. He took to Twitter to give his side of the story. However, there is more outrage over the admission of guilt and an apology. People want their money back. The bankruptcy of FTX so far …
When financial markets witness high inflation episodes, they are usually followed by a recession. Online conversations and data intensify as high inflation triggers a chain of interest rate action by monetary policymakers worldwide. If you observe the Google Search Trend since 2004, you can find how searches around the term ‘inflation’ are followed by ‘recession’. …
When financial markets witness high inflation episodes, they are usually followed by a recession. Online conversations and data intensify as high inflation triggers a chain of interest rate action by monetary policymakers worldwide. If you observe the Google Search Trend since 2004, you can find how searches around the term ‘inflation’ are followed by ‘recession’. …
It all started with a news report in April 2022 stating that a study published as an IMF working paper and authored by three reputed economists has concluded that India has, for all practical purposes, almost won the war over extreme poverty, defined as those living on less than US$ 1.9 in 2011 dollars per …
A lot of literature is published at this time of the year. Not the type that goes for the Booker prize. It is about your money and how you should invest in 2023. Experts will offer recommendations based on their assessment of the stock market situation. A lot of tailwinds and headwinds get analyzed. Numbers …
As we bring the year to a close, fears of another Covid Wave are back. Another China variant with supposedly higher infecting potency is bringing back the ghosts of the past spooking humans and global markets. Just ahead of the Xmas and New Year celebrations and with an on-going marriage season in full swing in …
COVID FEARS RESURFACE – AN OPPORTUNITY IN CRISIS? Read More »
It was supposed to help realise dreams. India’s consumer technology unicorns were riding on India’s aspirational middle class. There was an overall downward trend in the technology sector around the world. The Nifty IT sector index fell 27% in 2022, while the US Nasdaq 100 is down 35%. The Indian consumer technology firms, from fintech …
There are profits to be made if you play right. Most analysts’ annual investment predictions in 2023 are out. They talk of a 65000 level for the Sensex and 20000 for the Nifty. The two benchmarks are expected to gain 10-15% in value in the year ahead. However, these predictions hide the underlying tension due …
Expectations drive financial markets. Credit markets look forward to the cues on interest rates and inflation, while equity markets look to those about corporate profits. It is the final full budget that finance minister Nirmala Sitharaman will present on 1 February 2023 before the general elections in May 2024. There are expectations from all segments …
It was supposed to create a digital transformation revolution. Businesses of all shapes and sizes were supposed to embrace it quickly to hold on to customers. Digital technology-based outsourcing was supposed to drive rapid business for Indian IT services companies. Over the past year, though, share prices of IT service firms have barely moved. While …
It is an oasis in the desert, investors say. The Indian infrastructure space is considered an engine of growth by investors, big or small. Over the past few years, the Indian government has shown an inclination to spend more on boosting the infrastructure across the country. That is reflected in significantly high capital expenditure. As …
In a nutshell, budget FY24 focuses on seven priorities, or Saptarishi. These are inclusive development, reaching the last mile, agriculture, and investment, unleashing potential, green growth, youth power, and financial sector. 1) Big relief under the new tax regime: First things first. The finance minister provided the much-awaited relief to taxpayers by raising slabs. If …
It is typical of markets to rally ahead of the budget proposals and see some profit taking once the measures are announced. This time, however, the Adani group stocks played spoilsport. The key takeaway for me from the Budget 2023 proposals is that there is something for everybody. One key thing before any election budget is that …
Who wins from Budget 2023-24? The Union Budget 2023-24 presented last Wednesday is a perfect balancing act. Despite putting the nation’s finances on a fiscal consolidation path, the Budget also allocates appropriate capital expenditure to stimulate the economy. There are a lot of sectors that are winners. A few are losers. Banks and financial services …
There is an air of anticipation. India turns 100 in 2047, and if it continues to maintain the growth momentum of the past three decades, some dramatic changes will occur in the economy. A new report by EY, a global consulting firm, highlights that India will become a $26 trillion economy by 2047-48 when it …
It is getting dizzy out there. Last week, The Economist, a weekly publication from London, warned that the inflation problem in America is not fixed yet. That is despite a sharp surge in share prices and growth. Morgan Stanley, a global bank, sent a note suggesting that equity investors are shrugging off risks about a …
How to invest amidst growth versus inflation conflict Read More »
You can deal with situations that are bullish and bearish while investing. But finding your way through a period of lull is fraught with challenges. Your financial advisor may tell you things like portfolio diversification, rebalancing and thinking about the long term. All of that requires you to know a lot of stuff. Financial markets …
These are turbulent times. The US Federal Reserve chairman Jerome K Powell warned the US Congress “higher and longer” interest rates & cycle in the months ahead. Over the past few days, stock markets have been in an uproar. Silicon Valley Bank, a US-based bank that funds venture capital funding, collapsed. It failed to raise …
The collapse of the Silicon Valley Bank in the United States has triggered a crisis in the US and European Banks that may well turn into a contagion. A series of steep rates hikes to combat high inflation has led to re-pricing of bond portfolios as well as ALM mismatch. Systemic risk is difficult to …
In the license-permit-quota era of yore, entrepreneurship in India involved lobbying hard to get exclusive licenses to manufacture items that have a ready demand – whether in businesses involving natural resources like mining, land etc. or consumer products like cars, scooters, motor cycles, white goods, watches, telephone instruments etc. Most of the traditional entrepreneurial families …
As the financial year in India comes to a close, markets look for clues. Technology services companies release data every quarter that allows market analysts to make projections. Quarterly results of most tech companies are announced in the first fortnight of the new quarter. Ahead of that, US-based Accenture puts out data that is perceived …
The Reserve Bank of India’s Monetary Policy Committee (MPC) left key borrowing rates unchanged. That was the dovish part. However, most members voted to withdraw an ‘accommodative’ credit policy stance with an eye on inflation. That was the hawkish part. Financial markets were quick to react to the dovish part. The 10-year bond yields fell …
America could go from a virtuous cycle to a vicious cycle, said Jamie Dimon, chairman and CEO of JP Morgan Chase, in his latest annual letter to shareholders. Higher fiscal spending, rising gross debt to GDP, climate spending, higher energy costs and global trade disruptions are at fault. “We may have gone from a savings …
Investing in midcap companies is a challenge. You want to pick quality stocks and hope that a few eventually turn into potential multi-baggers or large caps. Stories of people buying Bajaj or HDFC twins in the early 2000s and making money by simply holding on to their investments are part of the folklore. However, when …
We live in strange times. Markets that are supposed to give you fixed returns are witnessing unprecedented volatility. Short-term interest rates in America are way too higher than long-term interest rates. If the US Congress does not increase the debt-ceiling limit on America’s borrowing soon, debt markets will likely see an unprecedented selloff fearing a …
Commodity prices are an indicator of times to come. Over the past year, metals and energy prices have taken a knock. If you observe the recent trend, it is even a sharper fall than in previous months. The selloff in the commodity markets indicates weak global demand going forward. It emanates from fears of a …
Stock picking is an art. You must know the right time to get in or out. It is a skill you can acquire after years of practice. For most of you, it is not your core competency. Yet, you must know when to invest or exit an investment to make your money work. You need …
There is an uneasy calm prevailing in financial markets. Bond markets have been showing an inverted curve for some time now in the rich world. Short-term interest rates are higher than long-term interest rates. Whenever that happens, a recession looms. Historically, that was the trend. The calmness in the global financial markets comes from a …
India’s economy grew at a faster-than-expected pace in the March 2023 quarter. The surprising upside resulted in analysts revisiting growth estimates for the next financial year ending in March 2024. There was an all-around excitement about the vital data released by the government. However, a closer look at the numbers can help you understand the …
There is a lot of chatter, about 100,000. The S&P BSE Sensex is expected to top the psychologically important mark over the next few years. The debate is not about ‘if’ but about ‘when’. Bulls expect the Sensex to scale the peak over the next three years. A conservative prediction expects it to be there …
