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💼As we move into the last week of trade before election results the market is near record highs. 💼Sharp short covering in index futures and huge delivery based buying in frontline stocks like HDFC Bank have contributed to the strength of the market. 💼Even though Nifty is near record highs, Bank Nifty is 2% away from its peak. 💼This indicates the potential of frontline banking stocks to move up further. 💼Another positive for the market is that the FII selling which weighed on the markets this month has declined sharply and FIIs even turned big buyers on Thursday. 💼The pharma sector has consistently turned out good results in Q4. 💼This is one of the preferred sectors of institutions and HNIs now. 💼The election related uncertainty may cause some volatility but is unlikely to cause any major jitters this week. 💼The market is likely to largely discount the results before declaration on June 4th. #StockMarket #inflation #EconomicOutlook #MarketUpdate #InvestmentOpportunity #EmergingMarkets #StockMarket #inflation #EconomicOutlook #MarketUpdate #InvestmentOpportunity #EmergingMarkets

💼The 1196 point rally in the Sensex yesterday was triggered mainly by the sudden shift in FII trade from sustained sellers to big buyers resulting in buying of Rs 4671 crores. 💼The massive short-covering caused by this sudden change in FII trade contributed to the sharp rally. 💼It is important to understand that the change in FII stance has been caused by the underperformance of the Hang Seng index which is down 4.1% during the last 5 days. 💼The outperformance of the Hang Seng had led to “ sell India, buy China” trade during the last one month. 💼It appears that this trade is over and that’s why FIIs have again turned buyers in India. 💼What makes this rally healthy is the fact that it is being led by fairly valued largecaps with the overvalued broader market taking a backseat. 💼The trend of outperformance of largecaps is likely to continue. #StockMarket #inflation #EconomicOutlook #InvestmentOpportunity #EmergingMarkets #MarketUpdate #StockMarket #inflation #EconomicOutlook #InvestmentOpportunity #EmergingMarkets #MarketUpdate

💼There are positives and negatives for the market today. 💼The biggest positive is the record Rs 2.11 lakh crores dividend from the RBI to the government, which will give additional 0.3% of GDP fiscal room for the government. 💼This means the government can reduce its fiscal deficit and step up infrastructure spending. 💼The bond yields have declined sharply reflecting lower borrowing by the government. 💼Decline in bond yields is positive for banking stocks. 💼Brent crude dipping below $82 is positive for India’s macros. 💼The negative for equity markets is the Fed meeting minutes which indicate concern over the stubbornness of inflation. 💼The remark, “ participants observed that while inflation had eased over the past year, in recent months there had been a lack of further progress toward the committee’s 2 percent objective” reflects worries over inflation. 💼This means that the ‘higher for longer’ rate regime is likely to continue for some time more till clarity emerges on inflation. 💼 The rate cut expectations, therefore, further get postponed. A slightly negative signal for global equity markets. #StockMarket #inflation #EconomicOutlook #InvestmentOpportunity #EmergingMarkets #MarketUpdate #StockMarket #inflation #EconomicOutlook #InvestmentOpportunity #EmergingMarkets #MarketUpdate

💼One inference that can be drawn from institutional activity this month is that there is no excessive concern regarding the much talked about election results jitters. 💼Net institutional selling is almost nil since the FII selling of Rs 37500 crores has been neutralised by DII buying of Rs 37369 crores so far this month. 💼Also, it is important to understand that FII selling has been triggered by the outperformance of Chinese stocks which nudged FIIs to sell in expensive India and buy in cheap Hong Kong. 💼Therefore, institutional activity does not reflect any election-related jitters. The decline in India VIX by 9% in recent days also indicate return of stability in the market. 💼The market is likely to respond to election outcome earlier than June 4th. 💼Investors can consider buying stocks before the results. 💼Priority can be given to largecaps which are fairly valued compared to the broader market where valuations are much higher. 💼A possibility around the election results time is both FIIs and DIIs turning buyers lifting the largecaps and the indexes to higher levels. #StockMarket #inflation #EconomicOutlook #InvestmentOpportunity #EmergingMarkets #MarketUpdate #StockMarket #inflation #EconomicOutlook #InvestmentOpportunity #EmergingMarkets #MarketUpdate

💼With 5 stages in the 7-stage elections completed, the market is slowly showing signs of stability. 💼The negative trigger of sustained FII selling also seems to be over when the FIIs turned buyers last Friday. 💼The prime minister has hinted about sharp rally in the market after June 4th. 💼The market is likely to move ahead before the election results since the market is smart enough to anticipate the results. 💼The Q4 results are generally good with decent revenue and PAT growth. 💼Among sectors, financials particularly banking, automobiles particularly two-wheelers, capital goods, real estate and pharmaceuticals have come out with impressive results and their prospects, too, look good. 💼Watch out for these sectors since they are likely to lead in an elections results-related rally. #StockMarket #inflation #EconomicOutlook #InvestmentOpportunity #EmergingMarkets #MarketUpdate #StockMarket #inflation #EconomicOutlook #InvestmentOpportunity #EmergingMarkets #MarketUpdate

💼 Dow Jones closing in record territory above 40000 will continue to provide the global support for equity markets. 💼 However, in India, the election related jitters might continue to cause high volatility. 💼 A significant trend now is the FIIs turning buyers yesterday, and this takes away the pressure on the markets. 💼 The unknown in the market now, and there are many views regarding this, is the impact of the low turnout in the first three phases of polling on the election results. 💼 If this impacts the BJP/NDA adversely and they fall short of the market expectations, there can be high selling dragging the market down. 💼 Conversely, if the BJP wins above 300 seats, there can be a sharp rally in the market. 💼 Largecaps in financials, autos, capital goods, telecom and real estate are likely to lead the rally. This appears to be the most likely scenario. #StockMarket #inflation #EconomicOutlook #InvestmentOpportunity #EmergingMarkets #MarketUpdate #StockMarket #inflation #EconomicOutlook #InvestmentOpportunity #EmergingMarkets #MarketUpdate

💼 There are some positive global and domestic cues which augur well for the market. 💼 The decline in US inflation in April to 3.4% YoY and retail sales cooling off indicate soft landing of the US economy, paving the way for rate cuts by the Fed. 💼 This favourable global construct can impart resilience to the mother market thereby providing stability to other markets. 💼 Domestically, the improvement in the voter turnout in the 4th phase of polling is a positive from the market perspective since it removes some jitters associated with election results. 💼 Coming to the market trends, the net institutional buying turning positive, the sharp recovery of nearly 350 points from the lows in Nifty and the large short position in the market have the potential to aid recovery in the market. 💼 Going forward, news from the political front are likely to turn more positive. 💼 FII-heavy stocks which bore the brunt of selling are likely to witness further recovery. . . . #StockMarket #inflation #EconomicOutlook #InvestmentOpportunity #EmergingMarkets #MarketUpdate #StockMarket #inflation #EconomicOutlook #InvestmentOpportunity #EmergingMarkets #MarketUpdate

💼 The underperformance of the Indian market during the last one month is striking. 💼 While the S&P 500 is up by 5.08 % and Euro Stoxx 50 is up by 3.74%, Nifty is almost flat with only 0.24% gain. 💼 More important is the huge outperformance of Chinese stocks with stunning gain of 17.38 % in Hang Seng. 💼 It is this outperformance of China that is causing the sustained selling by FIIs in India. 💼 India’s underperformance is like to change soon with clarity on election results. 💼 DIIs, HNIs and retail can turn aggressive buyers lifting the market sharply. FIIs can’t afford to miss this potential rally. 💼 The only risk is political instability after elections which appears a very low probability event now. 💼 Meanwhile the global market construct continues to be supportive with the US indices setting new records. 💼 The decline in US CPI inflation in April to 3.4% sets the stage for a rate cut by the Fed. . . . #StockMarket #inflation #EconomicOutlook #InvestmentOpportunity #EmergingMarkets #MarketUpdate #StockMarket #inflation #EconomicOutlook #InvestmentOpportunity #EmergingMarkets #MarketUpdate

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