Geojit Financial Services Ltd

💼 The relief rally witnessed yesterday is unlikely to have a free run in the coming days. 💼 Two sets of factors—external and internal—will restrain a sustained rally. 💼 Externally, the strong dollar and high bond yields in the US will prompt the FIIs to sell on rallies. 💼 Internally, the growth and earnings slowdown will be near-term negatives that will restrain the bulls. 💼 The high valuations in the market, in this challenging macro backdrop, cannot favor a PE expansion that can take the market significantly higher. 💼 Investors should prioritize safety over returns in the current context. 💼 Fairly valued segments like large-cap financials, sectors like pharma and IT with stable demand, and fast-growing segments like digital stocks are likely to remain relatively resilient in a challenging environment. . . . #StockMarket #inflation #GeojitOutlook #MarketUpdate #InvestmentOpportunity #EmergingMarkets #StockMarket #inflation #GeojitOutlook #MarketUpdate #InvestmentOpportunity #EmergingMarkets

💼 The FII buying witnessed in early December completely reversed last week, with FII selling of Rs 15,826 crores. 💼 The out-performance of the US (S&P 500 up 25% YTD) and the relative under-performance of India (Nifty up 14.64% YTD) are driving this change in FII strategy. 💼 The strength of the US economy, robust US corporate earnings, expectation of corporate tax cuts by President Trump soon after assuming office, and the steady appreciation in the US dollar are factors favorable to the US market. 💼 Slowdown in Q2 GDP growth and stagnation in corporate earnings in India have soured domestic market sentiments. 💼 In the short run, there will be market rebounds, which may be followed by renewed FII selling. 💼 A sustained rally is possible only when there are indications of a growth revival in the economy, which is likely in early 2025. . . . #StockMarket #inflation #GeojitOutlook #MarketUpdate #InvestmentOpportunity #EmergingMarkets #StockMarket #inflation #GeojitOutlook #MarketUpdate #InvestmentOpportunity #EmergingMarkets

💼 The FII buying witnessed in early December is getting reversed now, with this week’s selling reaching Rs 12,229 crores. 💼 This change in FII strategy is getting reflected in market trends, too, with largecaps, particularly financials, coming under pressure due to FII selling. 💼 This trend is unlikely to sustain, and, therefore, retail investors can adopt a strategy opposite to the FII strategy. 💼 Quality largecaps will soon bounce back. 💼 Pharmaceuticals have been resilient despite market weakness, and this trend can sustain. 💼 IT is likely to be strong in the near term, buoyed by the positive Accenture results and guidance. 💼 Gen AI is becoming a profit pool for IT companies. 💼 The negative response to the Fed’s commentary yesterday will be temporary. 💼 Recovery led by largecaps is possible in the near term. . . . #StockMarket #inflation #GeojitOutlook #MarketUpdate #InvestmentOpportunity #EmergingMarkets #StockMarket #inflation #GeojitOutlook #MarketUpdate #InvestmentOpportunity #EmergingMarkets

💼 When valuations are high, the market needs only a trigger to correct sharply, and this trigger was provided by the Fed guidance of fewer rate cuts in 2025, which went against market expectations. 💼 Even though the rate cut of 25 bp was in tune with the market’s expectation, the indication of only two cuts of 25 bp each in 2025, against the market expectation of three or even four cuts, spooked the market, resulting in a sharp sell-off in Wall Street. 💼 The Fed chief’s comments regarding the economy and the labour market are, in fact, positive, suggesting a resilient US economy. But always, the market gets spooked when the reality falls short of expectations. 💼 The dollar index rising above 108 and the 10-year bond yield spiking to 4.52% are clearly negatives from the perspective of FII fund flows, but this is likely to be only temporary. 💼 Sharp cuts in the market today will provide opportunities for investors to buy. 💼 The broader market will be impacted less despite high valuations since the FII impact will be negligible in this segment. Therefore, there can be a sharp bounce back in growth stocks in this segment. 💼 Long-term investors, who can ignore short-term gyrations, should focus on fairly valued large-caps, which will provide buying opportunities for investors who are prepared to wait. . . . #StockMarket #inflation #GeojitOutlook #MarketUpdate #InvestmentOpportunity #EmergingMarkets #StockMarket #inflation #GeojitOutlook #MarketUpdate #InvestmentOpportunity #EmergingMarkets

💼 The near-term market construct has turned weak with FIIs turning sellers on rallies. 💼 The trend of FII buying in early December has proved to be, as feared, a flash in the pan. 💼 Yesterday’s massive FII sell figure of Rs 6410 crores in the cash market indicates that more selling is in store on market bounces. 💼 The underlying reason for the FII selling in India is the outperformance of the US market and the underperformance of India. 💼 While the S&P 500 is up 27.5% YTD, Nifty is up only 12% YTD, and the fear is that this huge variation in relative performances may continue, given the strength of the US economy and the weakness in the Indian economy. 💼 The situation will change if leading indicators in India suggest recovery in GDP growth and corporate earnings in Q3. 💼 The focus of global markets today will be the Fed decision expected tonight. 💼 A 25 bp rate cut is priced-in by the market, so the attention will be on the Fed commentary. 💼 A significant trend in the Indian market is the outperformance of the broader market, where good results are getting appreciated by the market and there is no concern of FII selling. . . . #StockMarket #inflation #GeojitOutlook #MarketUpdate #InvestmentOpportunity #EmergingMarkets #StockMarket #inflation #GeojitOutlook #MarketUpdate #InvestmentOpportunity #EmergingMarkets

💼 Globally, markets will be looking forward to the FOMC outcome on Wednesday. 💼 Markets have already discounted a 25bp rate cut, and, therefore, the focus will be on the Fed chief’s commentary. 💼 Any departure from a dovish commentary will be a negative from the market perspective, though this is only a remote possibility. 💼 The US services PMI coming strong at 58.5% indicates a resilient economy, which augurs well for the market. 💼 The sharp spike in India’s trade deficit to $37.8 billion in November will put pressure on the rupee, pushing it towards 85 to the dollar. 💼 Exporters like IT and pharma will benefit from the depreciating rupee, while for importers, the import cost will increase, impacting their stock prices. . . . #StockMarket #inflation #GeojitOutlook #MarketUpdate #InvestmentOpportunity #EmergingMarkets #StockMarket #inflation #GeojitOutlook #MarketUpdate #InvestmentOpportunity #EmergingMarkets

💼 The excessive volatility witnessed on Friday reflects the sharp differences in perceptions about the near-term market trend. 💼 The huge positions in F&O segments are causing such heightened volatility in the market. 💼 The 500-point move in the Nifty from the day’s trough to the peak indicates massive short covering. 💼 While FIIs turning buyers in December, so far, after the relentless selling in the previous two months is a positive, investors should not assume that the FIIs will continue to buy. 💼 Strong dollar and high bond yields in the US are headwinds for capital flows. 💼 Slowdown in GDP growth and stagnant earnings growth are hurdles in the path of the bull. 💼 A rally will sustain only if the data regarding growth and earnings show recovery, which will take some time. . . . #StockMarket #inflation #GeojitOutlook #MarketUpdate #InvestmentOpportunity #EmergingMarkets #StockMarket #inflation #GeojitOutlook #MarketUpdate #InvestmentOpportunity #EmergingMarkets

💼 In the near term, the market has both a headwind and a tailwind. 💼 The headwind is the resumption of selling by the FIIs, who sold stocks for Rs 3560 crores yesterday. 💼 Given the high valuations in India, FIIs are likely to sell more at every market rise, as selling has been profitable for FIIs due to the appreciating dollar after the US election. 💼 The tailwind that can support the market is the declining inflation, with November CPI inflation at 5.48% coming within the RBI’s tolerance limit. 💼 If this trend continues, it can pave the way for a rate cut by the MPC in February. 💼 However, the rising dollar is a concern since it can lead to imported inflation. 💼 Nifty is unlikely to break from the range of 24500–24850, with buying emerging at the lower end of the band and selling resuming at the higher end. . . . #StockMarket #inflation #GeojitOutlook #MarketUpdate #InvestmentOpportunity #EmergingMarkets #StockMarket #inflation #GeojitOutlook #MarketUpdate #InvestmentOpportunity #EmergingMarkets

💼 The range-bound consolidation construct of the market is set to continue. 💼 The bull run in the US is continuing unabated, with Nasdaq setting a new record and closing above 20000 yesterday. 💼 The Magnificent Seven stocks continue their resilience and uptrend despite elevated valuations. 💼 The strength of the mother market, which indicates that the global market rally is intact, is a support for other markets, too. 💼 Even though the US CPI inflation in November at 2.7% has come a bit above the October numbers, this was on expected lines, and, therefore, the expectation of a 25bp rate cut by the Fed is intact. 💼 In India, the November CPI numbers to be released today will be keenly watched. 💼 Market action today will be largely stock-specific with limited moves at the index level. . . . #StockMarket #inflation #GeojitOutlook #MarketUpdate #InvestmentOpportunity #EmergingMarkets #StockMarket #inflation #GeojitOutlook #MarketUpdate #InvestmentOpportunity #EmergingMarkets