Modi believes that price is the most important factor in investing. He is credited with developing the AIRM (TM), an approach to screening stocks and businesses in a scientific manner. His role model is Warren Buffett.
Beware! Dalal Street is climbing a wall of worry; FIIs, DIIs diverging
Nifty50 is moving upwards albeit with caution, as it enters an unknown territory.
Nifty50 closed the week at 12,271, up 1.5 per cent.
Much to everyone’s surprise, Nifty and Bank Nifty touched new highs this week. Buoyancy was visible in equities across the globe in spite of concerns over rich valuations, trillions of dollars in negative interest rates, Trump’s impeachment and other unfavourable geopolitical developments.
FIIs spearheaded the indices with aggression, which led the bourses to attain higher levels, while DIIs showed hesitation and shied away from investing in the market. This divergent behaviour between FIIs and DIIs showed that Mr Market was now climbing a wall of worry. Currently, very few stocks have made 52-week highs, which is one of the least in last few years, when indices sit at new highs.
This is indeed worrisome, as majority of smallcap and midcap stocks are still languishing near their 52-week lows. All these facts point out that there is still a long way to go before the market achieves its true bullish potential.
Maximum bullishness is still far away! An increase in the number of stocks on the list of F&O ban or the lineup of IPOs seeing frenzied listing are a few indicators that signal that the indices have topped. Such aggressively optimistic signs are not visible currently, which signal room for further upside.
Investors should, however, maintain caution as all the positives are already factored in currently and the road ahead can be rocky for some time.
Event of the Week
ADVERTISEMENT
In a surprise move, RBI announced special open market operation to buy bonds worth Rs 10,000 crore and sell bonds of similar worth simultaneously. This step was taken specifically to lower longer-term yields, as they have consistently been on an up-move since RBI decided to keep the repo rate unchanged and slashed its forecast for economic growth rate to a decade low. Bond market enthusiasts and PSU banks will cheer this move, as the yield curve had steepened sharply despite RBI’s constant efforts to lower rates since the start of the year.
10 geopolitical risks looming over markets in 2020
1/4
While many people are making lists of New Year’s resolutions or presents they’d like from Santa Claus, another much more intimidating tally has come out as well.
Morgan Stanley Wealth Management has released a list of 10 geopolitical risks looming for markets in 2020 that are “keeping us awake,” according to authors led by Scott Helfstein.
Some of the scenarios are all too familiar to investors in a year that’s seen its share of uncertainty -- but is on track to end with most asset classes faring pretty well.
While many people are making lists of New Year’s resolutions or presents they’d like from Santa Claus, another much more intimidating tally has come out as well.Morgan Stanley Wealth Management has r..
Read More
Here’s the full list, from most to least likely:
1) Democratic World’s Perfect Leadership Storm
2) Emergence of Competing Trade Blocs
3) China’s Political and Economic Landings
4) U.S. Election Volatility
5) European Stimulus Is Day Late and Euro Short
6) Populism, Inequality and Shareholder Primacy
7) Market Positioning for Japanification
8) Cyber and the Risk of AI-vs-AI Warfare
9) Squeezing the Iran Balloon
10) Gene Editing Goes Wrong
“There is never a shortage of events that could weigh on financial markets,” the strategists wrote. “Most years, investors prove resilient and look through these risks to push assets higher.”
Here’s the full list, from most to least likely:
1) Democratic World’s Perfect Leadership Storm
2) Emergence of Competing Trade Blocs
3) China’s Political and Economic Landings
4) U.S. Election Vola..
Read More
Some of the ideas might seem surprising, like gene editing -- but that made the list given things like the news that a researcher in China had tried to immunize babies from HIV. The recent experiments “may involve questions about what it means to be human,” the report said.
Some of the ideas might seem surprising, like gene editing -- but that made the list given things like the news that a researcher in China had tried to immunize babies from HIV. The recent experiment..
Read More
Others, like emergence of competing trade blocs and U.S. election volatility, will be familiar to anyone who has been paying attention this year. Indeed, the leadership-storm idea and trade-bloc entry were on the late-2018 list also. The strategists even included a recap of their list from last year.
While in 2017, just four of the 10 items on their list went on to affect markets, the 2018 compilation included three that were “important” for markets and four that were “fairly prescient,” with just three missing the mark.
Others, like emergence of competing trade blocs and U.S. election volatility, will be familiar to anyone who has been paying attention this year. Indeed, the leadership-storm idea and trade-bloc entr..
Nifty50 is moving upwards albeit with caution, as it enters an unknown territory. The market is trying to gain strength and signal further upside. However there is strong resistance at current levels. Volumes are also not strong enough, which means there is a high chance that indices may correct before bouncing back. But if the current resistance is broken, then traders can go long till 12,400 level, which is the next resistance level. Traders should buy with caution in the coming week. Expectations for the Week
Yearend sessions are likely to witness extremely stock-specific movement with only a few pockets showing strength. A lot of rotation is also expected from high priced stocks/sectors for value buying in cyclical and commodities. Investors having a one-year horizon can allocate capital to metals, cement, sugar and ceramic sectors. One can also look at FMCG, as there are opportunities to accumulate these sticks at current levels. But invest only in quality companies from the above sectors to secure your portfolio from any micro risks. Nifty50 closed the week at 12,271, up 1.5 per cent.
ADVERTISEMENT
Merry Christmas to everyone!
(Disclaimer: The opinions expressed in this column are that of the writer. The facts and opinions expressed here do not reflect the views of www.economictimes.com.)
