The resurgence in Covid cases has once again triggered Covid trades. Investors are going back to what worked last year in the markets during the outbreak and lockdown. This seems the easiest thing to do. But one can’t be sure that this is the smartest thing. The way societies respond…
The sharp upswing in the dollar and the resulting softening of the rupee has set the context for another phase of volatility. If the exchange rates continue with this trend, exporting industries will benefit significantly. But, the commodity consuming companies and importers are heading for some rather testing times. The situation…
A roller-coaster financial year can either leave you all pumped up or all drained down. Where the markets end up in a financial year relative to the start unduly influences your mindstate. The overwhelming mood seems upbeat given the obvious influence of where markets closed the financial year. Recency bias…
A week back, the Suez canal was just another place at the back of your mind. Today, we know that at least 50 ships pass through it every day. The Suez Canal facilitates 12% of global trade. The cost of a blockage is pegged at $400 million per hour. That’s…
A much-ignored data point in all this equity market euphoria is the steady rise of global bond yields since August 2020. Globally, yields have moved up nearly 40 bps (0.4%). That number may not seem alarming in itself. Unlike equity, bonds are considered to be stable investments. So, there is…
The cryptocurrency craze that took winds a few years ago has now turned into a storm. Without much legitimacy beyond trading, this is almost becoming something between an asset class and a default currency to an entire generation of investors. The merit of this movement and the future of the…
The commodity rally is now in a very interesting place. Key OPEC members refused to provide more oil by maintaining production cuts. Across industries, there’s a shortage of raw materials. The price of almost every commodity is rising. User industries are struggling in this environment. If these prices hold even…
Global equity markets seem to be tiring. The yields are rising in US debt markets. Exchange rates are moving swiftly and unpredictably. The dollar gained when expectations ran to the contrary on what the US government may want. Gold has remained soft for weeks on end and seems to be…
The last year has changed our outlook towards returns, risks, and our potential. The market’s prolific rise, retail participation in the rise, and the role of index investing in this phenomenon have all led to a very confident state of mind among investors. This state of mind typifies every bull market.…
When soldiers are out at battle, they’re on high alert to act on a moment’s notice. Guns are effective only if the gunpowder is dry. The market context that we’re living through requires alertness. A correction will call for battle-ready skills. There is a risk in going ‘all-out’ now. In…
The budget seems to have changed the market’s view on cyclical stocks. There is a clear intent to spend our way out of the Covid economic crisis. We are now faced with the rising prospect of public investment, stable private consumption, and reforms. Disinvestment and better structural treatment of PSUs…
The results season has started with a bang. The early results have been blockbusters. Several blue-chip companies have done extremely well. Even beating expectations exceeding their historic bests, or touching higher metrics on multiple parameters for a quarter. Interestingly, with the exception of a few companies, most of these blockbuster…
