Geojit Financial Services Ltd

💼The recent correction in the market has not changed the underlying uptrend in the market. 💼FII selling is being countered by sustained DII and retail buying. And the strength of the economy is providing the fundamental support to the market. 💼Therefore, FII selling is not strong enough to pull down the market hugely, unlike in the past when FIIs used to call the shots. 💼This feature of the market can be utilised by investors to buy quality stocks which come under short term pressure due to FII selling. 💼It is important to buy high quality stocks in performing sectors since many unproven stocks in the broader market are flying high on hopes rather than on fundamentals or strong prospects. 💼Hyper speculative/ trading activity has pushed many mid and small cap stocks to frothy valuations. Correction in these stocks is only a matter of time. . . . #StockMarket #inflation #EconomicOutlook #InvestmentOpportunity #EmergingMarkets #MarketUpdate #StockMarket #inflation #EconomicOutlook #InvestmentOpportunity #EmergingMarkets #MarketUpdate

💼An important trend in the market which has implications for retail investors is the revival of the tug of war between FIIs and DIIs. 💼FPIs have sold equity massively for Rs 20480 crores during the last two days. 💼This is partly in response to the rising bond yields in US where the 10-year yield has risen to 4.16% and partly due to the high valuation in Indian stock market. 💼Since the largest chunk of FII AUM is in banks, they have been selling in banks, mainly HDFC bank. 💼Investors should remember that in the tug of war between FIIs and DIIs in recent years, DIIs always won in the medium to long-term even though FII selling can cause short-term pain. 💼FII selling due to external factors has always been opportunities to buy. This time is no different. 💼Mid and small cap segments are strong despite excessive valuations because there is sustained buying and no selling pressure from FIIs. This anomaly will be corrected in due course. . . . #StockMarket #inflation #EconomicOutlook #InvestmentOpportunity #EmergingMarkets #MarketUpdate #StockMarket #inflation #EconomicOutlook #InvestmentOpportunity #EmergingMarkets #MarketUpdate

💼At elevated valuations the market needs only a trigger for a sell-off and yesterday this trigger came in the form of HDFC Bank’s worse-than-expected results. 💼It is also important to understand that there was a sell-off in other emerging markets like Taiwan and Korea indicating that this an emerging market correction driven by FPI outflows. 💼FPI sell figure in India yesterday was huge at Rs 10578 crores. 💼In the context of rising bond yields in the US, FPIs may sell again. But this is likely to be countered by DII buying in fairly valued large caps with growth potential. 💼Investors may wait and watch for this turbulence to subside. The resilience in IT stocks in this crash is an indication of the strength of the sector. 💼Apart from IT, large caps like RIL, ICICI Bank, L&T and Bharti have strength to tide over this turbulence. 💼Further dips in HDFC Bank will provide buying opportunities for long-term investors. . . . #StockMarket #inflation #EconomicOutlook #InvestmentOpportunity #EmergingMarkets #MarketUpdate #StockMarket #inflation #EconomicOutlook #InvestmentOpportunity #EmergingMarkets #MarketUpdate

💼Market is likely to turn slightly weak in the near-term getting impacted by some negative global and domestic cues. 💼The global negativity will come from the rising bond yields in the US ( the 10-year yield is at 4.04 %) responding to concerns that the sharp rate cuts expected from the Fed this year may not materialise. 💼Now indications are that the Fed is unlikely to cut in March and the total cuts in 2024 may not be five or six that the market had partly discounted. This will be a drag on global equity markets. 💼Domestically even though the economy is doing well and corporate earnings are good, all these positives are in the price and the valuations are elevated warranting a correction. 💼The mid and small cap space is highly overvalued and is sustaining at high levels only by the high liquidity in the system. Some profit booking and moving the money to fixed income can be considered now. . . . #StockMarket #inflation #EconomicOutlook #InvestmentOpportunity #EmergingMarkets #MarketUpdate #StockMarket #inflation #EconomicOutlook #InvestmentOpportunity #EmergingMarkets #MarketUpdate

💼Nifty is now up 3 times from the Covid low of 7511 in March 2020. This is an indication of a strong bull market and it has a long way to go. 💼But the rally from now on will not be smooth and sharp corrections are likely since valuations are high. 💼What are the likely triggers for a correction? More often, than not, unexpected events cause corrections. 💼Geopolitical developments have the potential to trigger corrections. 💼But recent geopolitical events like the Israel-Gaza war didn’t impact crude prices or markets. 💼Similarly the skirmishes going on in the Red Sea also may pass without hurting the markets. 💼But there can be a near-term concern that the conflict may widen. So watch out for the events in the Red Sea. 💼Large caps in banking and IT and RIL are likely to remain resilient even in a downturn. 💼As a measure of abundant caution investors may consider booking some profits and moving the money to fixed income, where the returns are attractive. . . . #StockMarket #inflation #EconomicOutlook #InvestmentOpportunity #EmergingMarkets #MarketUpdate #StockMarket #inflation #EconomicOutlook #InvestmentOpportunity #EmergingMarkets #MarketUpdate

💼The rally in the market, primarily driven by momentum, is now getting support from fundamentals. 💼The sharp bounce in large cap IT stocks on the back of slightly positive management commentary indicates that an underperforming segment can surprise on the upside on news of a turnaround in the sector. 💼The IT index which shot up by 5% on Friday will remain firm since HCL Tech and Wipro have more room on the upside. 💼Nifty has broken out on the upside from the consolidation range and shows signs of further up move. 💼An important driver of the rally is RIL which is moving up on large delivery based buying on news of commissioning of the Dirubhai Ambani Green Energy project in H2 of 2024. 💼RIL, large cap IT and banking majors can provide fodder for the bulls in the near-term. . . . #StockMarket #inflation #EconomicOutlook #InvestmentOpportunity #EmergingMarkets #MarketUpdate #StockMarket #inflation #EconomicOutlook #InvestmentOpportunity #EmergingMarkets #MarketUpdate

💼With inline results from Infosys and better-than-expected results from TCS, IT stocks will see some action today. 💼Even though there is no positive message from the management commentary, the market is likely to respond positively to the absence of any bad news. 💼But the upside for TCS and and Infy will be limited since it will take time for clarity to emerge on the prospects for the sector in FY25. 💼Resilience in IT stocks and strength in Reliance will enable Nifty to consolidate around 21600 levels. 💼HDFC Bank results on January 16th will be keenly watched by the market for cues in the direction of Bank Nifty. 💼The U.S. CPI inflation inching up to 3.4% YoY is slightly negative from the global equity market perspective. 💼The rate cut expected from the Fed in March this year may not materialise. 💼It is likely to be postponed to June and , therefore, rate cut by the MPC will also get delayed. . . . #StockMarket #inflation #EconomicOutlook #InvestmentOpportunity #EmergingMarkets #MarketUpdate #StockMarket #inflation #EconomicOutlook #InvestmentOpportunity #EmergingMarkets #MarketUpdate

💼There is no consistency in FII and DII behaviour so far this month. 💼They are doing alternative bouts of buying and selling which is restricting the market in a range. 💼The market needs triggers to break out or breakdown from this range. 💼A probable negative trigger can be a slightly hawkish statement from the Fed postponing the rate cuts which the market expects to begin by March 2023. 💼The US CPI inflation data due tonight will provide cues regarding this. 💼The Q3 results season starting today with the results of TCS and Infy will provide indications of the Nifty earnings for FY24. 💼Financials, capital goods, telecom, automobiles and hotels will post good numbers. IT results will be tepid and FMCG will be a mixed bag. 💼More than broad market action, market responses will be stock-specific in response to results and management commentary. . . . #StockMarket #inflation #EconomicOutlook #InvestmentOpportunity #EmergingMarkets #MarketUpdate #StockMarket #inflation #EconomicOutlook #InvestmentOpportunity #EmergingMarkets #MarketUpdate

💼The market is moving up and down without a directional trend. 💼Up moves are countered with selling and down moves are responded with buying. 💼A trend might emerge in the coming days in response to Q3 results. 💼There is an important dichotomy in the market which has implications for investors. 💼Segments like defence and railways have run up too much too fast based on expectations triggered by order inflows. 💼It will take time for these orders to be executed and reflect on the bottom lines. 💼On the other hand there is value in segments like banking, particularly in high quality private sector majors. 💼But this value is not getting reflected in the price. 💼This is a short-term aberration which will correct in the medium to long-term. Here patience is the key. 💼Q3 results starting tomorrow will be keenly watched. 💼Regarding IT the management commentary will be more important than the results which will be tepid. . . . #StockMarket #inflation #EconomicOutlook #InvestmentOpportunity #EmergingMarkets #MarketUpdate. #StockMarket #inflation #EconomicOutlook #InvestmentOpportunity #EmergingMarkets #MarketUpdate