Geojit Financial Services Ltd

💼 Trump’s tariff tantrums have been impacting the markets for the last several days. 💼 Moving from targeting specific countries like Mexico, Canada, and China to imposing import tariffs on steel and aluminum across all countries has heightened concerns. 💼 The European Union’s declaration of retaliatory counter tariffs has increased the probability of a full-blown trade war. How this will pan out remains uncertain. 💼 It is important to understand that even President Trump cannot manipulate the laws of economics. 💼 If higher tariffs raise inflation in the US and the Fed responds hawkishly, the US stock market will crash, restraining Trump—though this may take time. 💼 Meanwhile, the market drama and volatility will continue. 💼 Investors can use the current market weakness to switch from overvalued mid and smallcaps to fairly valued largecaps. 💼 The market is in oversold territory, and a pullback is likely, but with FIIs expected to sell into any rally, the upside is capped. . . . #StockMarket #inflation #GeojitOutlook #MarketUpdate #InvestmentOpportunity #EmergingMarkets #StockMarket #inflation #GeojitOutlook #MarketUpdate #InvestmentOpportunity #EmergingMarkets

💼 A significant trend in the ongoing bearish phase is the outperformance of largecaps over the broader market. 💼 While the Nifty Midcap and Smallcap indices are down 8.6% and 11.3% YTD, the Nifty is down only 1.52%. This outperformance is likely to continue. 💼 Relentless FII selling in largecaps has made their valuations fair, while mid and smallcap valuations remain excessive. 💼 FIIs will eventually turn buyers in India, but that will only happen when the dollar index weakens. 💼 While we know this will happen, the timing remains uncertain. 💼 Investors should focus on quality largecaps in banking, IT, autos, pharma, and capital goods, and wait patiently. 💼 When FIIs return as buyers, they will primarily target the largecaps they are currently selling. 💼 Trump’s latest decision to impose 25% tariffs on steel and aluminum will impact Mexico, Brazil, South Korea, and Vietnam more. 💼 Metal prices are likely to remain soft for an extended period. . . . #StockMarket #inflation #GeojitOutlook #MarketUpdate #InvestmentOpportunity #EmergingMarkets #StockMarket #inflation #GeojitOutlook #MarketUpdate #InvestmentOpportunity #EmergingMarkets

💼 The Delhi election results, particularly the emphatic BJP win, though positive from a market perspective, are unlikely to trigger a sustained rally. 💼 With the dollar index above 108 and the 10-year US bond yield above 4.4%, FIIs will continue to sell the rally, limiting any potential upside. 💼 It is important to understand that valuations in India remain high, especially in the broader market. 💼 The market needs fundamental triggers like indications of GDP growth and an earnings rebound. 💼 Until then, the market is likely to move within a range. 💼 Investors should stick to fairly valued, high-quality largecaps. . . . #StockMarket #inflation #GeojitOutlook #MarketUpdate #InvestmentOpportunity #EmergingMarkets #StockMarket #inflation #GeojitOutlook #MarketUpdate #InvestmentOpportunity #EmergingMarkets

💼 Today, the market will be focused on the policy response from the MPC, particularly the message from the new RBI chief. 💼 Even though INR depreciation doesn’t provide a favorable macro construct for a rate cut, the market expects the MPC to vote for one, providing a monetary stimulus to complement the fiscal stimulus from the Budget. 💼 Since a 25 bp rate cut is partly discounted by the market, there could be a sell-off if the rate cut doesn’t materialize. 💼 There is only limited upside for the market, as FIIs have returned to selling mode after one day of symbolic buying. 💼 Apart from financials, IT and pharma stocks will continue to be the focus of DIIs. . . . #StockMarket #inflation #GeojitOutlook #MarketUpdate #InvestmentOpportunity #EmergingMarkets #StockMarket #inflation #GeojitOutlook #MarketUpdate #InvestmentOpportunity #EmergingMarkets

💼 The market is moving into a consolidation phase on expectations of a pickup in growth in the coming quarters. 💼 In the near term, the market is likely to get a mild boost from a possible 25 bp rate cut by the MPC tomorrow. 💼 Even though the steadily depreciating INR doesn’t provide a favorable macro backdrop for a rate cut, the MPC is likely to go for a 25 bp cut to sustain the optimistic momentum provided by the Budget. 💼 The macro trend in the US is turning favorable for EMs like India. 💼 The dollar index slipping to 107.56 and the 10-year yield declining to 4.4% are positives. 💼 FIIs are unlikely to press selling the way they did in January. 💼 Financials will be in focus today on rate cut expectations. . . . #StockMarket #inflation #GeojitOutlook #MarketUpdate #InvestmentOpportunity #EmergingMarkets #StockMarket #inflation #GeojitOutlook #MarketUpdate #InvestmentOpportunity #EmergingMarkets

💼 The uncanny ability of the stock market to surprise was clearly evident in the 1.8% spike in the Sensex yesterday. 💼 This sharp rebound reinforces the market wisdom that timing the market is difficult, and what truly matters is spending time in the market. 💼 Two factors are influencing the market trend now: 1.The market perceives the Trump tariff threats as negotiating tools that might not lead to a full-blown trade war. 2.The potential beneficial impact of the game-changing Budget is slowly sinking in. 💼 The most significant short-term positive for the market is FIIs turning buyers (Rs 809 crores) in the cash market for the first time since January 2nd. 💼 It remains to be seen whether this will become a trend. 💼 The decline in the dollar index and US bond yields are positive signals. 💼 Short covering and actions in the derivatives market will keep the market highly volatile today. . . . #StockMarket #inflation #GeojitOutlook #MarketUpdate #InvestmentOpportunity #EmergingMarkets #StockMarket #inflation #GeojitOutlook #MarketUpdate #InvestmentOpportunity #EmergingMarkets

💼 After the global sell-off in equity markets yesterday, there are positive signals today. 💼 The decision taken by Trump to temporarily freeze the tariffs on Mexico and Canada and start negotiations is a clear indication of his strategy: impose tariffs, then negotiate and strike a deal. 💼 The same strategy is likely to be tried with China, too. 💼 It is important to understand that a full-blown trade war will be damaging for the US as well. 💼 The decline in the dollar index to 108 is a positive development. 💼 Emboldened by the excellent Budget, investors, especially DIIs, are likely to step up investment, particularly in discretionary consumption segments. 💼 Cars, scooters, motorcycles, white goods like air conditioners and washing machines, jewellery, hotels, and food delivery businesses are the segments that will benefit from the Budget. Therefore, these are the segments to focus on. . . . #StockMarket #inflation #GeojitOutlook #MarketUpdate #InvestmentOpportunity #EmergingMarkets #StockMarket #inflation #GeojitOutlook #MarketUpdate #InvestmentOpportunity #EmergingMarkets

💼 Despite an excellent Budget, the market will be under pressure from the Trump tariffs and the heightened global uncertainty these ‘initial round of tariffs’ have triggered. 💼 It is important to understand that the 25% tariffs imposed on Mexico and Canada are to punish them for issues like immigration and illicit trade in fentanyl. 💼 Trump may use tariffs again against other countries on non-trade issues. 💼 China’s response to the 10% tariffs has been more responsible. 💼 For now, they have not reacted like Mexico and Canada by imposing tariffs on imports from the US. Instead, they are moving the WTO against the US action. Now we don’t know how this will pan out. 💼 For now, India is not affected. Therefore, the impact on the Indian market will be less. 💼 But the spike in the dollar index to above 109.6 will trigger more selling by FIIs, putting the market under pressure. 💼 Domestic consumption stocks will be relatively resilient since they stand to benefit from the income tax cuts announced in the Budget. . . . #StockMarket #inflation #GeojitOutlook #MarketUpdate #InvestmentOpportunity #EmergingMarkets #StockMarket #inflation #GeojitOutlook #MarketUpdate #InvestmentOpportunity #EmergingMarkets

💼 On Budget day, market reactions will be quick in response to Budget announcements. 💼 A major expectation from the Budget is a cut in personal income tax to provide relief to the middle class and boost consumption, thereby facilitating growth recovery. 💼 The extent of the tax relief remains to be seen. 💼 The fact is that there is no fiscal space for big relief. 💼 The market will be looking for growth-stimulating measures, not market-related taxation reliefs like changes in capital gains taxation. 💼 The market response to the Budget will not last more than a few days. 💼 Trends in growth and earnings recovery will dictate the medium to long-term market direction. . . . #StockMarket #inflation #GeojitOutlook #MarketUpdate #InvestmentOpportunity #EmergingMarkets #StockMarket #inflation #GeojitOutlook #MarketUpdate #InvestmentOpportunity #EmergingMarkets