Goodwill Investor Education Initiative: 5th July 2020
GW Eagle’s Eyes !-Market news:
The remarkably resilient Indian markets are up on ‘hope’ of early remedy for deadly Covid-19. Yes—vaccines will be out soon in the market- a great relief !
The week that has just gone by has indeed proved to be a boon for the insatiable Investors who have been waiting for a long time.
With the Indices scaling new highs after the Covid ’19 catastrophe, smiles are back at the face of investors who were beaten up for wrong reasons. The reason stated to be the light at the end of the tunnel viz., many Pharma and Research labs. are at the threshold of launching the anti- Virus drugs in the form of vaccines and are in the III phase of testing on animals and Humans and this hope and news have rightly triggered the sleeping giants in the markets. FPIs too have turned their focus on Bourses by investing in Equity markets. This is seen in Foreign Exchange Inflows which is likely to touch U S $ 500 Bn. The Rupee has also shown recovery and the oil prices are stabilizing around $ 35. Gold of course has gone up and now slowly sliding. When the economy is bad investors turn to Gold as the best option and revert to other forms of investments once the economy recovers.
The June rally in the market has been quite substantial and the investor sentiment has been going up as predicted, in a substantial manner. The fact is that the NBFC stocks which were beaten black and blue are back to pre-Covid levels. The risk-Volatility percentage is also getting stabilized slightly above 20 points which went up over 50 in the recent past.
The demand for FMCG and retail auto segment have started picking up with rural demand escalating sizably despite Virus issue getting more murkier globally.
Globally NASDAQ and China’s benchmark Indices rallied to highs although Dow Jones in June has been lukewarm. But the Corporate results for the Year ended 31st March 2020 is being watched with anxiety and curiosity by the Investors at large. And the current Fiscal performance of Companies have to be much better to regain the pre-covid status of the companies. An effective Covid vaccine would surely change the dynamics of the economic and demand environment which should lead to better performance by companies, more revenue for the companies and the Government by way of taxes. RBI and the Union Govt, has been rightly taking a lot of pro-active initiatives to boost the economic indicators and growth sectors like NBFCs, MSME etc.,
The Indian Manufacturing Index PMI is also going up steadily of late after touching new lows in the last quarter. The telecom sector needs more support in this growth environment and tax collections should improve in the days to come.
The Economy is poised to grow in the months to come which would be amply reflected in the markets- both equity and commodity markets and the investors staunchly believe that the worst is behind them.
So Investors are advised to do informed and value-investing steadily without being greedy and in a hurry. Good luck !
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