Domestic markets declined for second straight week, factors like concerns on US Fiscal Deficit, US Growth, Fed delaying rate cuts and US Trade Tariff’s deadlines are adding pressure to the markets.

Indian Markets also underperformed because of concern on rising valuations and caught in red amid profit booking after massive gains in last month.

While global environment is becoming more challenging with increased trade barriers, policy uncertainty, high inflation etc. India’s remains resilient with steady growth and low inflation.

A softer dollar with comfortable inflation outlook has given more window for EM Central banks to cut interest rates and spur liquidity. Historically, weak dollar index has supported Indian equities.

India is rising strategically and steadily with solid infra build up in the nation, rising digitization & financialization, nation emerging as a favourable manufacturing destination etc. have all contributed to India’s rising share in world exports.

The large-scale expansion in core infrastructure is likely to create a 3.2x multiplier effect on the economy while also attracting increased private & foreign capital inflows.

Alongside expanding its global footprint, India remains firmly focused on domestic consumption supported by rising income levels & evolving consumer preferences

Rising per capita income, high saving capacity, lowering trends of inflation and tax sops in the budget are likely to improve household balance sheets.

Shift in the nation’s income distribution is expected to drive stronger and premium-oriented consumer demand

The domestic demand too remains solid given the low inflationary pressures, rising disposable income and a shift in consumer preferences

While India remains relatively resilient, what are the watchful concerns for current stock market

1. Valuations although have come off from its Sep-24 highs but continue to remain high in the mid & small cap space
2. Equity Valuations Index suggest that market valuations are not cheap and continue to remain in neutral zone
3. DII flows remain strong but have moderated from its highs. FPI flows though recovered but global risks could stall the trend thereby impacting the market sentiments

Your portfolio needs to match the nation’s growth! Stay invested