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💼 With S&P 500 closing above 5000 for the first time, support from the mother market augurs well for the bulls. 💼But the bears are likely to take cues from the rising US bond yields ( 10-year yield is at 4.17%) which normally triggers big selling from FIIs. So the tug of war between the bulls and the bears is likely to continue. 💼 The fact that the markets are resilient even after the initial enthusiasm of early rate cuts in 2024, both in US and India, has moderated is an indication of the underlying strength of the market. 💼Apart from positive economic cues, a major factor supporting the market is the sustained flows to the market through mutual funds. 💼This can trigger buying on dips and the high market valuations are likely to be sustained for some time. 💼However, the frothy valuations of the broader market are a matter of concern. From the long-term perspective, safety is in large-caps. . . . #StockMarket #inflation #EconomicOutlook #InvestmentOpportunity #EmergingMarkets #MarketUpdate #StockMarket #inflation #EconomicOutlook #InvestmentOpportunity #EmergingMarkets #MarketUpdate

💼 When valuations are high the bears will use any negative news to push the market down. 💼 The slightly negative news, from the market perspective, came yesterday in the slightly hawkish comments of the RBI Governor. 💼The good news that the economy is doing better-than-expected and a GDP growth projection of 7% and CPI inflation of 4.5% for FY 25 was ignored. 💼The selling was aggravated with FIIs, too, running with the bears. There is a significant build up in the short position of FIIs. This normally happens along with the rise in the US 10-year bond yields which is now at 4.15%. 💼 FII selling and bear onslaught are unlikely to take the market down significantly. There will be strong buying on dips. 💼The sustained flows into mutual funds which is gathering momentum will enable the DIIs to buy aggressively. 💼A good investment strategy now would be to buy the bluechips which FIIs are selling. . . . #StockMarket #inflation #EconomicOutlook #InvestmentOpportunity #EmergingMarkets #MarketUpdate #StockMarket #inflation #EconomicOutlook #InvestmentOpportunity #EmergingMarkets #MarketUpdate

💼 The mother market US is setting new records and this provides the support to facilitate new records in India, too. 💼 The bulls are again on the front foot and will use any positive news to push the market forward. 💼The event which will be closely watched today would be what RBI says. No rate action is expected today, but the commentary from the central bank would be keenly watched. 💼Positive comments on the economy and any signs of a dovish tone will be positive for the markets. 💼Even while enjoying this bull run in the market, investors should keep in mind the fact that market valuations are high and partial profit booking and moving some money to fixed income would be a safe strategy. . . . #StockMarket #inflation #EconomicOutlook #InvestmentOpportunity #EmergingMarkets #MarketUpdate #StockMarket #inflation #EconomicOutlook #InvestmentOpportunity #EmergingMarkets #MarketUpdate

💼A significant feature of the ongoing bull market is its ability to bounce back from dips. 💼This makes buy on dips strategy successful. The bounce back happening now is being led by IT and supported by autos and pharma even while Bank Nifty continues to decline. 💼The fact that new leaders are emerging to take the market forward indicates that the uptrend is in tact and new record highs are possible soon. 💼An area of concern is the excessive speculation in low-grade stocks where many are doubling in a few days. 💼These excesses of a bull market warrant caution. Investors should stay in the comfort of high quality stocks. . . . #StockMarket #inflation #EconomicOutlook #InvestmentOpportunity #EmergingMarkets #MarketUpdate #StockMarket #inflation #EconomicOutlook #InvestmentOpportunity #EmergingMarkets #MarketUpdate

💼 The near-term market trend indicates exhaustion and there are no clear positive triggers that can take the market to sustained new highs immediately. 💼 An important event coming up is the RBI meeting on 8th. But no positive triggers like a rate cut are likely from the RBI meeting. 💼The global market construct also is challenging with the 10-year bond yield rising again to 4.13% and the dollar index rising to 104.5. 💼The positive takeaway is that the U.S. economy is doing surprisingly well and a sharp global slowdown triggered by a possible US recession is very unlikely. This, along with declining inflation in US can support global equity markets. 💼Investors may wait and watch for new trends to emerge while remaining invested in this bull market. . . . #StockMarket #inflation #EconomicOutlook #InvestmentOpportunity #EmergingMarkets #MarketUpdate #StockMarket #inflation #EconomicOutlook #InvestmentOpportunity #EmergingMarkets #MarketUpdate

💼The global construct for equity markets continues to be good with the mother market US doing well aided by a surprisingly strong economy. 💼The latest data on job creation in January has again surprised with addition of 3,53,000 jobs. 💼There are no signs of the US economy tipping into mild recession any time soon. This means that the Fed rate cuts expected this year are likely to be back-loaded. 💼This has pushed up the 10-year bond yield again above 4% and the dollar index to 104. This might prompt some selling by FIIs. But the market momentum is good supported by strong DII and retail buying. 💼Among the recent results Tata Motors and Interglobe Aviation stand out and these stocks have more room to go up. RIL also is exhibiting strength. . . . #StockMarket #inflation #EconomicOutlook #InvestmentOpportunity #EmergingMarkets #MarketUpdate #StockMarket #inflation #EconomicOutlook #InvestmentOpportunity #EmergingMarkets #MarketUpdate

💼Now that the two big events are behind us the market is likely to consolidate. 💼The non-populist Budget focused on fiscal consolidation is a big positive. The big allocation for rural housing will benefit all construction-related segments like cement, steel, paints etc. 💼Another important budget takeaway is the sharp decline in bond yields consequent to the net market borrowing kept low at Rs 11.75 trillion. This is beneficial for banks. 💼Global cues are better since the mother market US is appreciating the favourable trends in the US economy after the brief disappointment with the cautious Fed message. 💼It is evident that the US is heading for a soft landing and rate cuts are coming. Correction in the dollar index to 103 and the US 10-year falling to 3.88% may restrain the FIIs from selling. 💼The near-term risk in the market is the high valuation which can trigger corrections on some negative news. Expect high volatility in the near-term. . . . #StockMarket #inflation #EconomicOutlook #InvestmentOpportunity #EmergingMarkets #MarketUpdate #StockMarket #inflation #EconomicOutlook #InvestmentOpportunity #EmergingMarkets #MarketUpdate

💼While both the Fed decision and the Budget will influence the market today, the focus will be on the Budget. 💼Even though the interim Budget is expected to be largely a vote on account with “no sensational announcements” the PM’s statement yesterday that it will be a ‘blueprint of intent’ has aroused expectations that there will be some significant indications of what is likely to come in the full Budget and beyond. This will keep the market focused on the Budget. 💼The 1.61% sell-off in the S&P 500 yesterday was on disappointment that rate cut will not happen in March. 💼But the Fed chief’s comment that the economy is doing well with 3.1% GDP growth in 2023, low 3.7% unemployment and consumer price inflation declining to 2.6% augurs well for the market, going forward. 💼Sectoral and stock-specific moves in response to budget proposals will hog the limelight today. 💼But long-term investors should not be carried by the dramatic moves today and may focus on high quality stocks with good long-term growth prospects. . . . #StockMarket #inflation #EconomicOutlook #InvestmentOpportunity #EmergingMarkets #MarketUpdate #StockMarket #inflation #EconomicOutlook #InvestmentOpportunity #EmergingMarkets #MarketUpdate

💼 The Fed decision tonight and the interim Budget tomorrow will weigh on markets in the near-term. 💼 Global markets will be keenly watching the Fed comment on the time line and quantum of rate cuts. 💼The first rate cut is likely to come in June 2024. The decline in the 10-year yield to 4.02% is a positive since it will restrain FPI outflows. 💼The domestic market will be focused on the interim Budget particularly on any proposals regarding taxation of investments relating to the capital market. 💼The fiscal deficit and its glide path also is important since growth with stability is hugely important from the market perspective. 💼Stock specific movements are likely in response to sectoral allocations in the Budget. . . . #StockMarket #inflation #EconomicOutlook #InvestmentOpportunity #EmergingMarkets #MarketUpdate #StockMarket #inflation #EconomicOutlook #InvestmentOpportunity #EmergingMarkets #MarketUpdate