Geojit Financial Services Ltd

💼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

💼The 197 point decline in Nifty yesterday despite marginal buying by both FIIs and DIIs indicates strong build up of short positions in the market. 💼Long positions are steadily declining and short positions are building up. 💼This short build up is on bearish expectations that the present high valuations are difficult to sustain and some trigger may lead to sharp corrections. 💼This expectation need not be realised since global cues have again turned positive on rally in the US market. 💼Domestic cues are looking good. Buy on dips strategy may work again leading to some short covering. 💼Strong JLR numbers from Tata Motors and the attractive buy back offer from Bajaj Auto will give support to the Nifty Auto Index. 💼The real estate segment is doing well and the margin expansion happening in the industry bodes well for the sector. But most good news is in the price. . . . #StockMarket #inflation #EconomicOutlook #InvestmentOpportunity #EmergingMarkets #marketupdate #StockMarket #inflation #EconomicOutlook #InvestmentOpportunity #EmergingMarkets #marketupdate

💼The year-end rally which took the Nifty up by around 14 % from the 2023 October lows, is slowly running out of steam. 💼The major challenge for the rally comes from the mother market US which is showing signs of weakness. 💼The concern in the US now is that the market expectation of a rate cut in March may not materialise since the labour market continues to be tight and the unemployment data is lower than expected. 💼Inflation coming under control means that the rate hiking cycle is over and the Fed pivot is imminent. 💼But the market will be disappointed if the rate cut doesn’t happen in March. 💼The sign of this possible trend can be seen in the firming up of the 10-year US bond yield above 4%. 💼The exuberance of retail investors may be a positive factor which might push up the already frothy broader market. 💼But profit booking by DIIs and seasonally weak January can impact the rally. 💼Long-term investors can use dips in the market to buy high quality banking stocks which are fairly priced. . . . #StockMarket #inflation #EconomicOutlook #InvestmentOpportunity #EmergingMarkets #MarketUpdate #StockMarket #inflation #EconomicOutlook #InvestmentOpportunity #EmergingMarkets #MarketUpdate