Skip to main content

ADVICE FOR THE WISE - MAY 2020

From the CEO’s Desk
Dear Investors, “The trick is not to learn to trust your gut feelings, but rather to discipline yourself to ignore them. Stand by your stocks as long as the fundamental story of the company hasn’t changed.”- Peter Lynch. In the past three decades, the capital markets have faced many adversities and, from all events, the markets have emerged stronger than ever, and it will do so this time too. The silver lining of the Covid-19 crisis is the dramatic fall in equity valuations, which enables investor to buy quality stocks at rates that, have traditionally contributed to long-term sustained rebounds. For equities, April was a bounce-back month; global markets recovered sharply from the lows of March, as the central banks and governments around the world have come out with a slew of monetary and fiscal measures to curb economic downturns. FY21 started on a volatile note for the equities and other risky asset classes, with India and many world economies remaining in a prolonged period of lockdown. This has changed the fundamental dynamics of demand / supply and is projected to adversely impact the economy and company earnings. Interesting trends emerged in domestic equity markets following a steep downturn in March; stocks recovered sharply and reported a return of ~15 per cent for Nity50, with global equity market returns also on similar lines, volatility index(VIX) which reached 80+ levels in March , subsequently dropped below 40, while FPI outflows declined from $8.4 billion (March) to $503 million (April). Positive news flows around the development of COVID-19 vaccines together with Covid-19 graph flattening globally, attractive valuation across multiple sectors provided a motivating backdrop for Indian markets to recover the March 20 losses. We expect the impact of earnings slowdown and economic downturn to be largely priced in, while the impact of strong policy stimulus is gradually emerging. As the Covid-19 scenario plateaus, the expectations of the FII / FPI to return to emerging markets, and India in particular, are not unfounded on the back of humongous global liquidity and low interest rate scenarios; while steady SIP flows will continue to support the market in the short term.

Know more at http://www.karvywealth.com/data/sites/1/skins/karvywealth/Download_media_report.aspx?FileName=3E6ADE03-4057-4C3A-9335-F3C7BF175706|5184640
Labels:

Comments

Post a Comment

Popular posts from this blog

MUTUAL FUND SNAPSHOT - OCTOBER 2020

  ·      The mutual fund industry witnessed net outflows to the tune of ~52,091 cr in September 2020 as against net outflows of ~INR 14,553 cr in August 2020. The equity category witnessed net outflow of Rs ~1009 cr in September 2020 as against net outflow of Rs ~ INR 4028 cr in the previous month. ·          AUMs of debt, equity and hybrid schemes in August 2020 accounted for 49.9%, 29.5% and 11.0% respectively of the overall AUMs; the balance ~9.6% was contributed by solution oriented and other schemes. ·          AUM of the mutual fund industry declined by 2.3% MoM (INR63,407 Cr) to INR26.86 Lakh Cr in Sept 2020. On QoQ basis, the total AUM of Mutual Fund increased by 5.4% and 9.6% YoY.   ·          Domestic mutual funds were net equity sellers in last 4 months. Mutual Funds v were net equity sellers to an amount of INR 904.69 Cr...
Post a Comment
Read more

The World This Week – 7th – 15th Nov 2020.

Indian Equity Summary- ·          Optimism had rubbed its positive impact on the domestic market over the initial performance of Pfizer's Covid vaccine and the outcome of the US presidential election. Nifty and Sensex ended on a WoW basis in green and increased by ~4 percent. The government announced a series of stimulus initiatives, including credit support for stressed sectors, employment creation incentives and multiple measures for construction and housing, as boosters for the Covid hit economy under Aatmanirbhar Bharat 3.0, which boosted the market sentiment. ·          Going forward, with the uncertainty due to US elections moving out of the way volatility will reduce substantially leading to money moving towards the riskier assets; domestic factors like ongoing Q2 corporate earnings season, and FII/DII inflows and USD/INR rates ; will continue to dictate the trend of the domestic equity market. We...
Post a Comment
Read more

Punjab investors prefer to invest in equity: Karvy wealth

Individual investors in Punjab have placed their trust in equity the most, Karvy Private Wealth said on Wednesday. "Individual investors in Punjab have opted for a higher allocation to equity products in their mutual fund portfolio at 68.11 percent, as compared to the national average of 64 percent," the wealth management arm of Karvy Group said in a statement while quoting its India wealth report 2019. Chandigarh, Ludhiana, Amritsar and Jalandhar have all recorded a higher equity share in total assets under management than the national average, the statement said. "Keeping in mind the volatility in the markets, term deposits continue to remain a safe bet for investors. The overall growth rate in deposits is close to the national growth rate. Amongst the cities in Punjab, Chandigarh recorded the highest year on year growth at 12.12 percent, followed by Amritsar at 11.39 percent," it further said. Karvy Private Wealth CEO Abhijit Bhave said direct equ...
Post a Comment
Read more