We always see new story about the market that is why market is unpredictable. But if corporates are generating better earnings and economy is stable, nothing to worry about in long term investment.
Recently we have seen market corrections all over the world. Reason Bank of Japan last many decades having 0% interest rates to combat deflation. But recently due to high inflation BOJ has hiked interest rates by 0.25%. Which creates the problem for ‘carry trade’, investor’s borrow funds from Japan which had 0% interest rates, converted USD and invested other countries where interest rate is much higher. This led unwinding Yen carry trade resulted in high volatility in equity markets.
These are short term panic; we should follow fundamental and principle for long term investing.
I have given my view in some of my video that become crorepati early, should buy in corrections as an opportunity.
US data indicates slowdown in the labor market, triggering concerns of recession. There is expectation from Fed that may cut interest rates from Sept 24 to reduce the uncertainty of recession.
Nifty 50 PE is trading at 23.3 compare to 5 years average PE of 25.33. Where Five years low PE at 17.15 and high at 42.
Nifty Midcap 100 PE is trading at 44.2 compare to 5 years average of 48.24. Where five-year low PE is 18.62 and high PE is 420.61.
Nifty 50 EPS is 1075 which is expected to grow by 14% in next two years with expected EPS to reach 1225 by FY2025 and 1397 by FY26.
Full year GDP growth of India is 8.2% financial year ending March 24 and expected to grow by 7.3% Q4/24, sill India as the fastest growing economy in the world.
10-year G-sec is at 6.9%
11% increase in rural development spending to INR 2658 billion, positive for consumer sector.
Overall growth driven by automobiles 34% YOY, Real Estate 80%, health care 19%, and BFSI 19%.
Estimated Real GDP growth of 6.5% to 7% for FY25.
Employment rate of India increased marginally from 46.6% in Mar 24 to 46.9% in Q1/24.
Current account deficit is 0.7% of GDP for 2024, which is improved from 2% of GDP in 2023. Reason for improvement: decline in merchandise trade deficit, rising net services exports and increasing inflows in India.
Gross Fixed Capital Formation in India increased to INR 15701 billion in Q1/24 vs INR 14066.89 billion in Q4/23
GST collections in August up 10% at INR 1.74 Lakhs crore vs INR 1.59 Lakhs crore YOY.
Total amount collected through SIP is around INR 23332 crore in July 24.
Unemployment Rate in India is expected to be 7.30 percent by the end of this quarter, according to Trading Economics global macro models and analysts’ expectations. In the long-term, the India Unemployment Rate is projected to trend around 6.90 percent in 2025 and 7.10 percent in 2026, according to our econometric models. (Source Trading Economics).
Foreign Institutional Investors infused around $ 3.3 billion vs Domestic Institutional Investors $2.8 billion into the Indian markets, which shown positive sentiment and economic growth of India.
11.11 trillion allocations towards capital expenditure by government, promotes infrastructure and development projects. Which boost economic growth, create jobs, and strengthen manufacturing and MSME sectors.
We believe that to build healthy portfolio’s, we must have long term vision.
Disclaimer: The above chart/data is for informational purpose. Past performance may or may not be sustained in future.
Mutual Fund investments are subject to market risks, read all scheme related documents carefully before investing.