As markets near record highs, investors are confused over how they should structure their portfolios. Bhavesh Sanghvi, chief executive officer of Emkay Wealth Management, shares his views on how investors could go about allocating money at this juncture. The market is at an all-time high and valuations appear rich. What could be a good asset allocation mix now? […]
After the recent FOMC (Federal Open Market Committee) meeting, the US Federal Reserve has moved up its target from 2024 to 2023 for the first hike in interest rates, which is a potential rate hike in future faster-than-expected. Two hikes in 2023 are the estimate. In fact, a significant number of the FOMC members, though […]
One major factor that dominated oil markets is the possibility of a nuclear deal between the US and Iran, and also better relations between the two countries, based on the reported talks between the two parties. This would mean that the supply from Iran will be in the markets as soon as such a pact […]
The US Dollar remained range-bound against major currencies, as it came out of a stark weakening phase, though the unit remained weak against the Euro and the Pound Sterling. The Euro and the Yuan gained over the last couple of months against the Dollar, to the extent to 3 % to 4 %. The likelihood […]
Gold is trading at 1885 against the dollar, though it attempted breaking the resistance level 1910 unsuccessfully. What has been giving life to gold is the concerns on recovery after the second and third wave of the pandemic, inflation concerns, and also falling yields in the very recent past. Global gold ETFs lost US$1.10 billion […]
The focus of attention is gradually shifting again to the US recovery, away from the impact of the second and third wave of the pandemic. While growth is happening in the US, and the improvements in employment are good, the job gains are not entirely matching up to the estimates or expectations. With major spends […]
The GDP numbers present a picture of revival in economic activity from the depths to which it had fallen during the first wave of the pandemic. GDP growth Q4 FY 21 is at 1.60%, compared to just 0.50% in Q3. For the whole year the GDP growth is at -7.3%, which amply reflects the stress […]
The fixed income markets continue to remain more or less range-bound, eagerly waiting to factor in the probability of any future rise in interest rates. There is more or less agreement among the market participants that rates should rise at some point in time during the course of this year, but the question is when? […]
The GDP growth number for Q4FY21 was reported at 1.6% as compared to 0.5% in the preceding quarter. The GDP for FY21 was reported at -7.3%, largely reflecting the pandemic driven impact to the economy. The GVA number for Q4FY21 came in at 3.7% as compared to 1% in the preceding quarter. The yearly growth […]
The policy announcement from the RBI, after the MPC meeting, has left all the key policy rates unchanged. It has reaffirmed the commitment to continue with the accommodative stance. It was expected that the RBI may not bring about any changes in the policy as such due to two factors, (i) there was an interim […]
The fixed income market remained calm with a stable profile for the most part of the last month. The accommodative policy of the RBI has been instrumental in keeping the yields stable to lower. Yet another reason is the interbank liquidity which has been on an average upwards of Rs 5 lakh crore. The G-SAP […]
Early Hints You may be able to recall that in the Emkay Navigator, June, 2021, we had discussed the US-centric developments as follows: “The focus of attention is gradually shifting again to the US recovery, away from the impact of the second and third wave of the pandemic. While growth is happening in the US, […]
The CPI based inflation rose sharply in the month of May as against the expectations of a moderate rise from the inflation numbers of April month. The headline CPI inflation was reported at 6.30% for the month of May’21 as compared to 4.23% for the preceding month and 6.27% during the year ago period. A […]
When we work in an environment, far away from home, and which is quite uncertain and sometimes volatile too, both in terms of work and earnings, it is important that we look for growth with stability in investment portfolios. This applies more to NRIs and much less to others. The search for stability takes us […]
Inheritance of assets by NRIs can be more complex than inheritance by residents because it involves transitioning of assets between countries which involves the laws of both countries, says Namita Agarwal, AVP- Succession Planning, Emkay Wealth Management. She is a lawyer and company secretary who specializes in cross border succession laws and has advised multiple […]
The policy announcement from the RBI, after the MPC meeting, has left all the key policy rates unchanged. It has reaffirmed the commitment to continue with the accommodative stance. It was expected that the RBI may not bring about any changes in the policy as such due to two factors, (i) there was an interim […]
Joseph Thomas, Head of Research at Emkay Wealth Management feels the vaccination efforts may become more rapid with several state governments taking the initiative to source the vaccines, as vaccination alone will be able to put an end to the pandemic. It may not be reasonable or prudent to assume that there will be a […]
The GDP growth number for Q4FY21 was reported at 1.6% as compared to 0.5% in the preceding quarter. The GDP for FY21 was reported at -7.3%, largely reflecting the pandemic driven impact to the economy. The GVA number for Q4FY21 came in at 3.7% as compared to 1% in the preceding quarter. The yearly growth […]
The equity markets have been volatile with movements on both sides, mainly occasioned by developments abroad. The prospects of the US recovery, the rise in inflationary expectations and the rise in bond yields have all been factors that influenced the markets in the last two months. One factor that has attracted attention of the markets […]
The US’ first-quarter GDP growth for 2021 was at 6.4 percent against the estimated 6.5 percent but signifies a major surge in the economic activity after the pandemic battered the economy. The second quarter of 2020 saw the biggest fall in US growth, which plunged by 31.4 percent and left 22 million Americans unemployed. There […]
Succession planning for minor children is a must. In an unfortunate event of demise of both the parents, a properly drafted Will would ensure that the parents appoint a guardian of their choice for the minor children. In absence of a will or if the will is silent with respect to guardianship, the court will […]
The equity markets have been volatile with movements on both sides, mainly occasioned by developments abroad. The prospects of the US recovery, the rise in inflationary expectations, the rise in bond yields, have all been factors that influenced the markets in the last two months. One factor which has attracted attention of the markets has […]
Brent is perched on the US$ 68 level per barrel for a long time now, and it has been unusually range-bound. But its ability to rise cannot be easily ignored. This is because, if you go by the indications from the market, buying of petroleum futures contracts has accelerated in the last three weeks, and […]
The US Dollar has given up much of the gains after it rose against all the majors in the last three months. The rise in the Dollar was facilitated to a large extent by the expectations of high inflation and the consequent rise in interest rates especially the bond yields. The bond yields shot up […]
Consumer Price Index for the month of April, came at 4.29 % quite on the lines expected by many market participants mainly due to the fall in the food inflation and the favourable base effect. This is quite a bit of a pull back from the 5.52% level seen in March. Last year, for the […]
Apart from all the other factors that affect gold price movements in international markets, there is one factor that has a certain impact, and it is the weakness or strength of the US Dollar. The US Dollar after a bout of strengthening against currency majors is now gradually giving up the ground that it gained […]
The US first quarter GDP growth was at 6.40 % as against the expectations of 6.50 %, but a major surge in the economic activity after the pandemic battered the economy. It was Q2 of 2020 which saw the biggest fall in US growth, as it plunged by 31.40%, and it left 22 million Americans […]
The fixed income market remained calm with a stable profile for most part of the last one month. The accommodative policy of the RBI has been instrumental in keeping the yields stable to lower. Yet another reason is the interbank liquidity which has been on an average upwards of Rs.5 Lakh Crs. The G-SAP 1 […]
The yellow metal is an essential ingredient of any investment portfolio for many centuries. It is not just private individuals who invest in gold but also institutions. The central banks or the reserve banks around the world invest in gold in a major way. They keep it as part of their reserves. When they find […]
Consumer Price Index for the month of April, came at 4.29 % quite on the lines expected by many market participants mainly due to the fall in the food inflation and the favourable base effect. This is quite a bit of a pull back from the 5.52% level seen in March. Last year, for the […]
One common feature in the life of NRIs is that they are time-poor. They earn well, but they do not have sufficient time to make informed decisions on matters concerning their finances. They need support and advice on how to manage the amounts of money that they earn through their hard work. Quite a large […]
One way of looking at the major economies and the progress they have made towards normalisation is to look at three things. One, the quality of the economic recovery in these territories; two, the persistence or otherwise of their expansionary policies; and three, the current efforts at containing the recent wave of infections. United States […]
Joseph Thomas, head of research at Emkay Wealth Management, says the market is unlikely to see the record highs of FY21 frequently, so one should moderate expectations and plan the portfolio accordingly. The midcap segment and some select smallcaps should get priority in the scheme of allocation and carefully chosen midcap funds will be a […]
Non- residents live and work under very different conditions from what is available locally in their country of origin. Sometimes they may be good, and sometimes conditions need not necessarily be that comfortable. Whatever it is, most of the non-residents intend to return to their country of origin as they finish the most active working […]
Oil prices too have been range-bound without any major surge in prices as expected earlier. This is due to the fact that the OPEC + had decided that they may increase production gradually by about 2 million barrels per day. The prices have found a base at the US$ 60-63 levels. What is likely to […]
The US Dollar has risen against all currency majors except the GBP, thus consolidating its position of power in the recent past. This has been the result of robust economic and employment numbers in the US promoting the belief in a speedy revival of the economy. That there is bound to be revival in Europe […]
There are five major influences on the fixed income market, which are marked clearly as of now. These are the liquidity conditions, the government borrowing program, the trajectory of bond yields in the developed markets, the inflationary expectations and finally, the RBI policy. In the last one year the RBI has been extremely supportive of […]
The surge in the pandemic and the rise in the number of cases is not a good signal for the equity markets. This has resulted in limited lockdowns in many parts of the country, and some are more stringent than the rest. If such conditions persist it is bound to impact growth adversely and we […]
The curiosity about the government borrowing program is much less compared to the other developments around the fisc. This is because the quantum of borrowing is clearly laid down in the budget a couple of months ahead of the new financial year. But things like the maturity profile of the borrowing, the composition in terms […]
One way of looking at the major economies and the progress they have made towards normalization is to look at three things. One, the quality of the economic recovery in these territories, two, the persistence or otherwise of the expansionary policies, and three, the current efforts at containing the recent wave of infections The first […]
1. POLICY RATES UNCHANGED On expected lines, the RBI has kept the policy rates unchanged, the repo rate stays at 4%. The accommodative stance has been reaffirmed. The soft stance with adequate liquidity support will continue till sustainable growth emerges, and more so in the light of the resurgence in the second wave of the […]
Consumer Price Index (CPI) The CPI based inflation, continued to inch upwards owing to broad based inflationary pressures; the food and fuel as well as core inflation remained firm in the month of Mar’21. The headline CPI inflation was reported at 5.52% for the month of Mar’21 as compared to 5.03% for the preceding month […]
1. Policy Rates Unchanged On expected lines, the RBI has kept the policy rates unchanged, the repo rate stays at 4%. The accommodative stance has been reaffirmed. The soft stance with adequate liquidity support will continue till sustainable growth emerges, and more so in the light of the resurgence in the second wave of the […]
The manufacturing activity, as measured by the PMI index, continued to report healthy growth. The manufacturers indicated that sequential improvement in demand and a pick-up in bulk orders were the key factors underpinning the robustness in manufacturing sector. The headline index numbers fell to a seven-month low of 55.4 in the month of March from […]
The curiosity about the government borrowing program is much less compared to the other developments around the fisc. This is because the quantum of borrowing is clearly laid down in the budget a couple of months ahead of the new financial year. But things like the maturity profile of the borrowing, the composition in terms […]
The US bond yields have moved up quite sharply, the 10-year treasury has touched 1.60 percent and this movement is occasioned by the expectations of a higher price level in the United States. As economic recovery is happening at a swift pace, faster than expected, some amount of inflation would likely crop up. This has […]
The CPI based inflation, after easing for three consecutive months, rose on the back of upward move in food prices; headline CPI inflation was reported at 5.03% for the month of Feb’21 as compared to 4.06% for the preceding month and 6.58 during the year ago period. Over the recent past it has been the […]
Dr. Joseph Thomas, Head of Research, Emkay Wealth Management, believes two-thirds of the mid-cap stocks are still relatively undervalued and are trading closer to their historical averages. Moreover, their earnings have a strong positive correlation with the rate of economic growth. This leads one to the conclusion that they will make much better gains from the […]
However, this can be avoided by having a well-crafted estate plan in place and a will may be the most important document that you would write. This is important not only for the elderly but for every individual above the age of thirty years. It is a part of your overall financial planning because it allows you to select […]
The US Dollar continued to maintain a stronger undertone against all the currency majors as is evident from the currency movements for more than a month now. One of the major factors that contributed to the Dollar strength is the sell off in the bond markets across many developed markets. The rise in bond yields […]
Brent has shot up, through the US$ 70 per barrel, and it looks set to rise more. The recent rise in the prices, in the last few days, has more to do with the attack on the oil facilities of Saudi Arabia by some terrorist groups. The damages caused to the Saudi facilities is quite […]
Gold prices moved up from mid-2019 onwards to 2020 end, mainly due to two or three crucial factors. Broadly the range was from 1430 to 2067. The first and most important, fundamental, cause was purchases by central banks and the large inflows into gold exchange traded funds. The lower interest rates in many of the […]
The domestic equity markets have been hovering around the peaks, which the indexes have formed in the last couple of months. The domestic macro numbers have been on expected lines, and it gave comfort to the markets about the sustainability of the rebound in economic activity. But it is mostly the events from overseas markets […]
Yields or interest rates have been edging higher during the course of the last three months and it will continue to be so for some time. The immediate reasons are – RBI hiked the CRR which was going to increase the borrowing and lending costs for banks, there has been some pick up in credit […]
The GDP growth number for the last quarter, Q3FY21, at 0.40% corresponds to more or less what most of the market participants and analysts had expected. The GDP has reported positive growth after two consecutive quarters of contraction (-24.4% for Q1FY21 and -7.3% for Q2FY21). That should bring in some amount of relief. The reason […]
One of the most impressive fiscal exercises in the recent past was the UK budget, presented on March 3, 2021. This is the first budget post the Brexit departure event, which was marked by lot many uncertainties. The corporate tax rate has been hiked to 25 % from the current 19 % while leaving majority […]
Estate planning is about wealth structuring so that one could enjoy it and then pass it to the next generation in a smooth manner, avoiding any kind of family disputes on inheritance. While discussing estate planning for women, we could broadly classify women of this century into two categories. First, women who are primarily homemakers, […]
Interest rates came down to low levels and liquidity became aplenty due to the accommodative monetary policies by world central banks, and the expansionary fiscal policies pursued by the governments. This was a direct response to the economic distress caused by the global pandemic and the resultant fall in employment, output, and demand. It is […]
“Death is not the end. There remains the litigation over the estate,” said Ambrose Bierge. Any litigation over an estate erodes not only the family wealth but also family relations. A well-crafted estate plan and with a well-drafted will could avoid such litigations. A will puts down the wishes of a person for distributing her […]
The GDP growth number for the third quarter at 0.40 percent corresponds to more or less what most of the market participants and analysts had expected. That should bring some relief. The reason for this is two-fold. First, the growth is in the positive territory—the economy is growing, though at a borderline rate. Two, the […]
The GDP growth number for the last quarter, Q3FY21, at 0.40% corresponds to more or less what most of the market participants and analysts had expected. The GDP has reported positive growth after two consecutive quarters of contraction (-24.4% for Q1FY21 and -7.3% for Q2FY21). That should bring in some amount of relief. The reason […]
Brent has moved up quite in line with expectations towards US$ 60 from a level US$ 53 about a month back. The rise in oil prices has been supported by several factors in the last three months. The most prominent factor is the output restrictions by OPEC + and more conspicuously by Saudi Arabia. The […]
The currency markets, which witnessed a fall in the US Dollar, against the currency majors has reversed the trend for the time being. The gains made by the US Dollar is more pronounced against the Euro and Japanese Yen. Against Yuan, it has held its position well at stable levels, whereas against the Pound Sterling […]
Gold after making an all-time high of US$ 2067 in August 2020, corrected down to the 1890 and 1860 levels. Currently, gold is trading at around the 1840 level. The pull back in gold prices is probably a prelude to testing lower levels, and as indicated in our last update, technically, the resistance levels will […]
The two recent events of consequence to fixed income have been the budget and the monetary policy announcement. The budget has announced an additional borrowing of Rs.80,000 Crs for Feb and March, the original borrowing plan was getting over by Jan 21, end. While this additional borrowing is not that much unexpected, that there is […]
The equity markets started the rise with the accommodative policy of the central bank which provided ample liquidity as well as targeted support for select sectors. The expansionary fiscal policy also provided the much-needed support at a time when economic growth was not happening and there was general economic distress. This paved the way for […]
The RBI released its own budget-like document, wherein it reiterated its commitment towards an accommodative policy to support growth and also came out with supportive measures to ensure flow of liquidity to segments of the economy immediately in need of it. In this context, while on the one hand RBI announced phased restoration of CRR […]
The US economy is going to benefit from the fiscal spending that the government has already initiated, and more is expected from the new dispensation which assumed power last month. The tough line against China, Russia and Iran is going to be in place but the approach to the specific issues may be different from […]
The budget announcement for FY22 was keenly awaited as it was declared against the backdrop of a global pandemic. The economic activity across the globe came to a virtual standstill owing to the lockdowns imposed to control its spread. On the one hand budget was expected to be growth supportive, but there were cautions being […]
The CPI based inflation eased for the third consecutive month on the back of fall in prices of food articles; headline CPI inflation was reported at 4.06% for the month of Jan’21 as compared to 4.59% for the preceding month and 7.59% during the year ago period. The headline inflation numbers touched a sixteen-month low […]
Emkay Wealth Management’s head of research Joseph Thomas says the Reserve Bank of India’s plan to hike the cash reserve ratio (CRR) will have an impact on the cost of borrowing for corporates as well as other borrowers. In its final bi-monthly monetary policy review, the Reserve Bank of India left repo rates unchanged at 4 percent and kept […]
The RBI released its own budget-like document, wherein it reiterated its commitment towards an accommodative policy to support growth and also came out with supportive measures to ensure flow of liquidity to segments of the economy immediately in need of it. In this context, while on the one hand RBI announced phased restoration of CRR […]
It is not unusual for people to have a heap of expectations from the budget and it is more so after a year of extreme economic distress, job losses, and demand destruction. The government and the Reserve Bank of India initiated several measures to combat the adverse economic conditions. This resulted in an infusion of […]
The budget announcement for FY22 was keenly awaited as it was coming in the backdrop of a global pandemic. The economic activity across the globe came to a virtual standstill owing to the lockdowns imposed to control its spread. On the one hand, budget was expected to be growth supportive, but there were cautions being […]
The Real Estate Investment Trust (REIT) is structured like Mutual Funds (MF), in the sense that it allows pooling of investor money to buy a particular asset. Here is how they work and why they offer a number of benefits to investors. REITs, as the terminology suggests, invest in income-generating real estate assets. The investors […]
The slide of the US Dollar against all the currency majors continued to be the event that is most talked about in currency markets. There is no single major currency against which the Dollar has held well. This is despite any number of regional issues which have been there. This gives rise to the inference […]
Oil prices continue to stay above the US$ 50 level, and it seems to be wanting to base itself at these levels for a potential upward movement. This trend in prices is despite the fact that the economic realities prevailing globally do not permit any surge in oil prices. The Asia-Pacific Region is dominated by […]
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 at […]
All the indexes have moved up, benefitting mainly from the accommodative fiscal and monetary policy, which facilitated an unprecedented liquidity expansion. It is the low interest rates and the ample liquidity that have helped rebound in the economy to some extent and spurred the markets to move up. These favourable conditions also helped the overall […]
The yields at the short end as well as the long end remained more or less stable in the last two months. The market has been supported by the surplus liquidity conditions all this while and this may continue to be the singular factor deciding the course of the markets in the future too. While […]
There are sure signs of economic recovery in the US, EU, China, and India as well. But it may be too early to call it a full-fledged recovery. The macro variables reflect a rebound in economic activity, but the level of economic activity is still not at the pre-pandemic levels as yet. This is mainly […]
The economy and the markets have gone through conditions that we have not witnessed in a lifetime. But things have started improving gradually. The markets have moved up. The economy is rebounding. But the experiences during the year that has just gone by leaves us with a lot of lessons as far as our financial […]
The industrial activity growth, as measured by IIP, contracted in the month of Nov’20 after growing for two consecutive months. The IIP growth for the month of Nov’20 was reported at -1.9% as compared to growth of 4.2% in the preceding month and 2.1% in the year ago period. The relaxations in lockdown have definitely […]
The CPI based inflation eased for the second consecutive month on the back of fall in prices of food articles; headline CPI inflation was reported at 4.59% for the month of Dec’20 as compared to 6.93% for the preceding month and 7.35% during the year ago period. The headline inflation numbers touched a fifteen-month low […]
Joseph Thomas, Head of Research at Emkay Wealth Management, expects the economy to recover in 2021 but says the market will be closely watching how the government brings back fiscal discipline. The rolling back of lockdown restrictions had resulted in heightened economic activity. Consumer confidence was coming back and we could look forward to better […]
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 […]
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 […]
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% […]
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- 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 […]
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 […]
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 […]
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 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 […]
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 […]
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. […]
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 […]
