On a risk-adjusted basis, the returns from the shorter maturity funds is far superior. The yields at the short end, as well as the long end, remained more or less stable in the last two months, but the short end rates have moved up a bit in the last two weeks. The change over to normal […]
Month: December 2020
Infrastructure sector may get more attention in Budget 2021
Bhavesh Sanghvi, CEO of Emkay Wealth Management, who is an alumnus of Columbia Business School and NMIMS and has over 3 decades of experience, is of the view that we may see more companies beating the earnings estimates in FY22. A word of caution though – stick to your defined asset allocation. Sanghvi is of the view […]
Q2 GDP: What Do We Read Into It?
India enters a technical recession with two consecutive quarters of economic growth contraction. The GDP contracted by 7.50% in Q2FY21, as against the 23.90% contraction seen in Q1. It is pertinent to note that the rate of GDP growth is at an 11-year low, as compared to 4.20% in 2019-20, and an expansion of 6.10% […]
Brent: Charting its Own Course
Oil prices have moved up from its US$40-45 range to US$ 45-50 range. The uptick in prices has been caused by several factors. In the initial days after the US elections the news was that the new President was against fracking and that may affect oil supplies. But a study of the last three or […]
Gold may test support levels….
Gold- backed ETFs have seen major outflows in Nov 20., the first outflow in the last one year. This is also the second largest outflow ever since ETFs came into existence. Gold ETF holdings came down by 107 tons or US$ 6.80 billion, equivalent to about 3% of the assets under management. This movement happened […]
Rise in Equities: Attempting to be Logical…
Like it has been in the last three months, the indexes have risen to the highest levels in the lifetime of the markets. This rise has been facilitated by ample liquidity, hope in a faster recovery from the pandemic related setbacks, and economic numbers which instilled greater hope for the future. Corporate profitability in India […]
Fixed Income: Market Remains Stable and Calm…
The fixed income market has been extremely calm and traded within narrow ranges for more than two months now. This is the result of an accommodative policy and a liquidity glut occasioned by the expansionary policy. The rates on commercial papers and certificate of deposit has come down to low single digit levels, to levels […]
Currency Markets: Year-end Weariness Sets In
The currency markets witnessed a fall in the US Dollars against all the currency majors. This has happened mainly after the US presidential elections, and it is perceived as a trend that may endure for some more time. In terms of investments there has been a gradual rising preference for emerging markets assets as evidenced […]
The Fed: Policy stance unchanged, underlying tone less aggressive
The FOMC statement released yesterday maintains status quo on the base rate. The following were the main decisions at the FOMC meeting: To undertake open market operations to maintain the federal funds rate in a target range of 0 to 0.25%. Purchase of treasury securities will be US$ 80 billion per month and mortgage-backed securities […]
Some Respite from High Food Inflation
The CPI based inflation eased after the hardening trend of the preceding three months; headline CPI inflation was reported at 6.93% for the month of Nov’20 as compared to 7.61% for the preceding month and 5.54% during the year ago period. The inflation numbers remained outside the RBI’s target range but eased on the back […]
IIP: Stays in Expansionary Zone
The IIP growth reverted to positive zone after a gap of six months in Sep’20 and maintained the momentum in the month of Oct’20. The IIP growth for the month of Oct’20 was reported at 3.6% as compared to upwardly revised growth of 0.5% in the preceding month and -6.6% in the year ago period. […]
‘RBI policy supportive of both stable and buoyant markets, with its moderating implications for rates’
The RBI policy announcement has left the repo rate unchanged at 4 percent, and it has decided to continue the accommodative stance of the policy “as long as it is needed”. This is quite in line with what market participants expected from the RBI. The potential for inflationary pressures has also received attention from the […]
Accommodative Stance to Continue But Rate Cut Cycle is Stalled
Rates & Policy Stance Unchanged The RBI policy announcement has left the repo rate unchanged at 4%, and it has decided to continue with the accommodative stance of the policy as long as it is needed. This is quite in line with what market participants expected from the RBI. The potential for inflationary pressures has […]
Q2 GDP looks much better but no guarantee of improvement unless government spends more
The Indian economy contracted 7.50 percent in the second quarter of this financial year against a decline of 23.90 percent in the first quarter. Technically, the country is in a recession following two straight quarters of contraction but the slowdown is gradually easing. The gross domestic product (GDP) growth is at an 11-year low, compared […]
Oil Prices May Be Range Bound
Oil prices are hovering around the US$ 38-42 levels with an obvious downward bias, at present. This downward bias is the result of the rising COVID-19 infections throughout the US and the major countries of Europe. Except for China, the prospects of any rise in oil demand is more or less ruled out due to […]
Asset Movements Decide Currency Movements
As far as the US dollar is concerned a lot would depend on the US policies in the coming months as we quickly move past the US elections and the installation of a new government. While basic policies may not find any major shifts, there may be some modifications in the details. The approach towards […]
Gold Well Supported at Current Levels
Gold is currently trading at US$ 1880, and the price movements have been with a downward bias in the last one month or so. This fatigue after a move above the US$ 2000 mark is attributed to a number of factors. There has been selling by some central banks over the last two months. Central […]
Fixed Income: Stay at the Short End..
What is interesting about the fixed income market is that there have not been any major changes as such in the markets in the past one or two months. This means that there is quite a bit of stability in the rates and the market levels, and this position may not change drastically for another […]
China is Bouncing Back; US, Europe Lagging
China is bouncing back with a vengeance, from the contraction of 6.80% seen in the first quarter of this year, at the peak time of the pandemic. Economic growth has picked up very fast. China reported a GDP growth of 4.90% on a Y-O-Y basis, up from 3.20 % clocked in Q2 of this year. […]
Q2 GDP: What do we read into it?
India enters a technical recession with two consecutive quarters of economic growth contraction. The GDP contracted by 7.50% in Q2FY21, as against the 23.90% contraction seen in Q1. It is pertinent to note that the rate of GDP growth is at an 11-year low, as compared to 4.20% in 2019-20, and an expansion of 6.10% […]