Stock Market Insights & Recommendations

GA, we have seen unprecedented momentum in gold that is witnessed after many years.

Political crises across many developed countries, a weaker dollar, buying by many central banks, and expectations of interest rate cuts from the US Fed have made the yellow metal a safe haven.

Silver, its sibling cousin, has also outshone all other asset classes. It has been a tough year for Indian equities so far. 🇮🇳 Although the market remains upbeat on changing economic data points, the mad rush of IPOs and secondary market fund raising by many promoters (more OFS than for business) remains the most worrying aspect.

Gm, as we are close to end of 1st of half of this fiscal year.
I believe it was fairly tough for Indian equity markets, as they underperformed MSCI Emerging markets. Also we saw FII money flow from India to China as well.

Offlate, we are seeing some flows in passive money flows in US listed India ETF, after continuous outflows in last few months.

The economic activity will also pick up in 2nd half coupled with interest rate cut would hopefully revive the sentiment.

Only joker the pack is the too much supply of papers by promoters in both primary and secondary markets.

GA, we all had a nail biting experience yesterday during the India v/s Pakistan final match. Indian team held their nerves till the last minute, and successfully snatched away victory from a tough opponent.

Few more learnings from the match:

1) Never be over complacent of your current position (Pakistan was 113/1 and then collapsed within 33 runs)
2) Be mentally strong, don’t give up till the end (India were 20/3, but then Mid order stabilised the innings)
3) Rise to the occasion (Focus was on Sharma but Verma delivered, when it mattered the most)
4) Timely grab of an opportunity (Verma, Samson, Dubey and Rinku)
5) Missing opportunity can cost you big (Verma run out chance)
6) Never give up till the end (this will ensure 7-0 score card)

Gm, the U.S. Federal Reserve, in line with market expectations, has reduced the benchmark interest rate by 25 basis points and provided a dovish outlook, projecting two additional rate cuts before the year’s end. The focus has demonstrably shifted towards the labor market, superseding inflation concerns. Newly appointed official Stephen Miran dissented, advocating for a 50-basis-point reduction. Consequently, the market is anticipated to exhibit a positive trajectory, anticipating further dovish signals. The U.S. dollar is expected to remain subdued, while gold and equities are projected to maintain an upward trend.

GA, recent bond market activity indicates a sell-off in the long-dated global bond market. Specifically, we’ve observed a rise in 30-year US yields, reaching approximately 5%. The UK is experiencing its highest yields in 27 years, at 5.75%, while Japan is witnessing a significant increase in its 20-year bond yields, the most substantial in a century.

This trend may be attributed to increased government spending in developed nations and potential inflationary pressures stemming from trade tariffs. Additionally, the supply of corporate bonds in the region is contributing to the pressure. As the Federal Reserve prepares to potentially lower interest rates, traders are generally favoring shorter-dated notes over longer-dated bonds.

The increase in the long-dated yield curve suggests that global bond investors are concerned about fiscal irresponsibility and the overall inflation outlook of developed countries.

GE, the recent market activity has been characterized by range-bound behavior accompanied by declining trading volumes. Volatility has diminished significantly, with a notable absence of price swings. The VIX remains subdued, likely due to a lack of significant news and generally consistent financial results. This trend is mirrored in the US markets, where strong earnings reports from various companies have not triggered substantial market reactions, potentially indicating that much of the positive sentiment is already reflected in the valuations of large-cap stocks.

GA, it seems cement prices in overall Southern region (mainly Andhra Pradesh) have seen a hike of Rs50-60 per bag in last quarter leading to the increase in the realization across all major cement players. Also the prices have sustained from the June-July monsoon spread and the company expects the prices to stabilize at these levels with variation of Rs3-5 per bag, not affecting the realizations much.

Gm. The current market sentiment reflects a strong aversion to uncertainty, mirroring previous conditions. The re-emergence of trade-related rhetoric is contributing to global market volatility. The initial July 9th deadline has been extended to August 1st, accompanied by ongoing trade-related pronouncements. To date, only two conversions have been reported, with other nations maintaining a cautious stance. Despite the distribution of the letter, no further agreements have been reached. The continued strengthening of US 10-year bond yields warrants close monitoring. Domestically, our focus will shift towards the earnings season, which commences today.

GA, given the current geopolitical landscape, characterized by significant conflicts in the Middle East and parts of Europe, and unpredictable leadership prioritizing anything but peace, we observe heightened volatility across all asset classes, including gold. This volatility is expected to persist into July, driven by impending tariff deadlines and the upcoming Federal Reserve meeting.