Geojit Financial Services Ltd

💼Two divergent trends are evident in the market now: one, strength in the global market led by the US and two, weakness in the Indian market. 💼The record setting uptrend in the US market is being driven now by the ‘Trump trade’, expectations of implementation of the promised corporate tax cuts and its positive impact on US corporate earnings. 💼The weakness in the Indian market can be attributed largely to the relentless selling by FIIs which continues this month, too. 💼After the massive FII selling of Rs 113858 crores in October, FIIs have so far, in November, sold equity for Rs 16445 crores in the cash market. 💼The rationale for the FII selling is, the elevated valuations in India which appear conspicuous in the context of the earnings deceleration evident in the Q2 numbers. 💼If the Q3 numbers and leading indicators reflect recovery in earnings, the scenario can change with FIIs reducing selling and even turning buyers. 💼Investors will have to wait and watch for the data. Meanwhile, investors can consider shifting some money from the overvalued mid and smallcaps to quality largecaps. 💼This strategy will turn profitable in the medium to long run. . . . #StockMarket #inflation #GeojitOutlook #MarketUpdate #InvestmentOpportunity #EmergingMarkets #StockMarket #inflation #GeojitOutlook #MarketUpdate #InvestmentOpportunity #EmergingMarkets

💼The Trump victory is turning out to be more potentially transformative than thought earlier. 💼With the Congress and the Senate coming under Republican control and President Trump exercising power without bothering about another term in office, hugely transformational decisions are possible in the months following Trump’s assumption of office. 💼These decisions may turn out to be both good and bad. His pro- business initiative of ‘America First’ can strengthen the American economy. 💼But if he walks his talk and imposes 60 % tariff on Chinese imports and 10 to 20 % tariff on imports from other countries, that would trigger inflation and jeopardise the Fed’s policy of containing inflation, necessitating a rethink of the Fed’s present policy of rate cut. This has the potential to negatively impact global stock markets. 💼It is important to understand that even though Trump’s anti-China policy has positive implications for India, Trump has been critical of ‘India’s high tariffs’ and won’t hesitate to impose tariffs on India’s exports to US. 💼The ‘Trump trade’ which has sharply lifted the US markets is unlikely to have similar positive impact in India since Indian market valuations are high and there are headwinds of an earnings slowdown. 💼Investors should stick to quality and value during this period of euphoria and uncertainty. . . . #StockMarket #inflation #GeojitOutlook #MarketUpdate #InvestmentOpportunity #EmergingMarkets #StockMarket #inflation #GeojitOutlook #MarketUpdate #InvestmentOpportunity #EmergingMarkets

💼The sharp rebound in the market yesterday indicates a halt to the downward trend witnessed during the last many days. 💼The fact that the rebound is being led by fairly-valued and fundamentally strong large banking stocks is important and points to the possibility of the continuation of the trend. 💼However, the poor earnings growth in Q2 and earnings downgrades for FY 25 are headwinds that will constrain a sustained rally. 💼What is likely is stock-specific action in response to results, guidance and expectations. 💼Investors can utilise the market rallies to move from high-priced mid and smallcaps to the safety of largecaps. 💼The noise and action related to the US elections will last only for a few days, after which economic fundamentals will determine the direction of the market trend. . . . #StockMarket #inflation #GeojitOutlook #MarketUpdate #InvestmentOpportunity #EmergingMarkets #StockMarket #inflation #GeojitOutlook #MarketUpdate #InvestmentOpportunity #EmergingMarkets

💼With all attention focused on the outcome of the US presidential election, perhaps the more important domestic economic issue is not getting the importance it deserves. 💼It is important to understand that India’s underperformance is striking: while S&P 500 is up 20.45% YTD Nifty is up by only 10.36% YTD. 💼Clearly, domestic issues are weighing on markets. With two thirds of Nifty 50 companies missing their earnings estimates in Q2, Nifty 50 earnings for FY25 has been drastically revised down to less than 10% from the consensus 15% earlier. 💼With this kind of earnings downgrade it would be difficult to sustain the current valuation. 💼This is the rationale of the relentless FII selling which might continue for some more time. 💼Investors can opt for the safe strategy of remaining invested and accumulating stocks in segments which can weather the volatility. 💼Apart from leading financials, auto stocks like Eicher Motors and M&M have exhibited earnings momentum and improving prospects, going forward. . . . #StockMarket #inflation #GeojitOutlook #MarketUpdate #InvestmentOpportunity #EmergingMarkets #StockMarket #inflation #GeojitOutlook #MarketUpdate #InvestmentOpportunity #EmergingMarkets

💼With Nifty returning 25 percent and Nifty 500 returning 30 percent in Samvat 2080, investors should be happy. 💼But the 6.2% correction in October, the first above 5 percent correction in 54 months, has triggered anxiety over the market performance, going forward. 💼Of serious concern is the relentless FII selling in October amounting to Rs 113858 crores through the exchanges. 💼Given India’s elevated valuations and concerns over deceleration in earnings growth, FII selling might continue, impacting the benchmark indices. 💼In such a scenario investors should focus on stock-specific investment where Q2 results have been good and earnings visibility is bright. 💼The latest data regarding banking indicates that deposit growth has caught up with credit growth and this augurs well for banking stocks which are fairly valued. 💼Public capex is likely to pick up in H2 FY 25 and this augurs well for cement stocks. 💼Pharma stocks like Sun Pharma and Cipla have good earnings visibility. . . . #StockMarket #inflation #GeojitOutlook #MarketUpdate #InvestmentOpportunity #EmergingMarkets #StockMarket #inflation #GeojitOutlook #MarketUpdate #InvestmentOpportunity #EmergingMarkets

💼This Diwali is unlikely to see fireworks in the market. 💼India has been underperforming in October with Nifty down 5.7% when markets in US and Japan have delivered positive returns and China and Hong Kong have hugely outperformed. 💼India’s underperformance is driven by lofty valuations, relentless FII selling and concerns over slowing earnings growth. 💼In the near-term, this scenario is unlikely to change, reversing the trend decisively, even though mild pullbacks are possible. 💼A significant trend in the market is the strong stock-specific action. 💼Better-than-expected results are responded with sharp moves up to 20% a day while worse-than-expected results are met with around 15% correction. 💼This trend of strongly rewarding good results and punishing poor results equally strongly is a reflection of the focus on stock-specific action rather than focus on the benchmark indices and market as a whole. 💼Given the elevated valuations, and the possibility of continuing FII selling, stocks and sectors which have delivered good results and good guidance are likely to remain resilient. Investors should focus on these segments. . . . #StockMarket #inflation #GeojitOutlook #MarketUpdate #InvestmentOpportunity #EmergingMarkets #StockMarket #inflation #GeojitOutlook #MarketUpdate #InvestmentOpportunity #EmergingMarkets

💼A distinct change in the long-term market trend is discernible from the recent market movements. 💼The overarching trend that took the Nifty from the COVID low of 7511 in March 2020 to above 26200 in September 2024 has been the ‘buy on dips’ strategy that worked well consistently. 💼With the massive, sustained and unprecedented selling by the FIIs, which has touched Rs 98085 crores this month up to 24th, the buy on dips strategy is not working. 💼More important, the consensus downward revision in FY25 earnings estimate and the weak Q2 numbers have soured the sentiments to slightly bearish mode. 💼The positive factor is the sustained flows into mutual funds that is helping DIIs absorb the massive FII selling. 💼This can provide resilience to the otherwise weak market where even after the 7% correction there is no valuation comfort, except in pockets like largecap financials. 💼Growth stocks are likely to be more resilient in this market where value is hard to come by. . . . #StockMarket #inflation #GeojitOutlook #MarketUpdate #InvestmentOpportunity #EmergingMarkets #StockMarket #inflation #GeojitOutlook #MarketUpdate #InvestmentOpportunity #EmergingMarkets

💼The major headwind that the market is facing now is the massive, unprecedented and sustained FII selling which has touched Rs 93088 crores through 23rd October, as per NSDL data. 💼The fundamental trigger for the FII outflows is the elevated valuations in India and the relatively cheap and attractive valuations in markets like China and Hong Kong. 💼The FII selling is getting aggravated by news of slowdown in corporate earnings. 💼Uptrend in the market is not compatible with downtrend in earnings growth and, therefore, the market is witnessing selling at every rise, turning the near-term market structure into ‘sell on rally.’ 💼Investors should be cautious at this juncture and refrain from chasing temporary rallies. 💼High quality financials and IT stocks can be bought on dips. 💼Digital stocks which continue to show acceleration in growth can be gradually accumulated on declines. . . . #StockMarket #inflation #GeojitOutlook #MarketUpdate #InvestmentOpportunity #EmergingMarkets #StockMarket #inflation #GeojitOutlook #MarketUpdate #InvestmentOpportunity #EmergingMarkets

💼The ongoing trend of largecaps outperforming mid and smallcaps is likely to sustain, going forward. 💼FII selling and the countervailing trend of DII buying is likely to continue. 💼This will impart strength to largecap financials, particularly banking stocks like HDFC, ICICI, Axis and Kotak which are fairly valued in this market with elevated valuations. 💼Investors need not rush to buy the beaten down mid and smallcaps since there is more pain left in this segment where valuations continue to remain very high. 💼There can be individual cases of sharp rebounds in this segment. 💼Zomato’s Q2 results indicate continuing acceleration in revenue and profitability. This is a stock to watch. 💼In the coming days the market will be looking forward to the outcome of the US presidential elections and its possible impact on the market. . . . #StockMarket #inflation #GeojitOutlook #MarketUpdate #InvestmentOpportunity #EmergingMarkets #StockMarket #inflation #GeojitOutlook #MarketUpdate #InvestmentOpportunity #EmergingMarkets