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[hfe_template id='11223'] [ad_1] Synopsis There are 20 reasons/ explanations/ justifications put on the table for every move the market makes. Especially now, as the Nifty and Sensex recover from five months of correction. These explanations have their own role in the stock market, and it is sometimes good to listen to them. But, whether it is small-caps or mid-caps or large-caps, earnings and their stability are what finally matters in the market. And earnings are dependent on growth potential as well as the ability of the management to deliver growth. So, as the market recovers, focus on two things. First, whether there was a slowdown in the earnings of the company. And if yes, whether a recovery has taken place in Q4. There is a high probability that, as the Nifty and Sensex recover, a number of investors are looking to increase their exposure to stocks once again. For all of them it is time to remember the basic reality of equity investing. When you buy a stock, you ...

[hfe_template id='11223'] [ad_1] Synopsis At about this time last year, everyone from regulators to policymakers to masters of the market were cautioning against exposure to small-cap stocks. Did anyone pay heed? Probably not. Today, a large majority is feeling the pinch. There is an inverse relationship between many elements of the stock market and it is more complex than what we assume it to be. So, as small-caps see their worst performance of the last few months, it’s probably a good time to look at the logic of investing in the segment. Remember: Just because they are small-caps, they are not all bad. At the same time, when there is euphoria, all of them don't become good One problem with investing in small-caps is that there are so many inverse relationships between different variables that it becomes too difficult to figure out which equation to believe at what point of time. Just to put this in perspective: Was August 2024 the best time to buy small-cap stocks...

[hfe_template id='11223'] [ad_1] Synopsis Anyone who doubts that volatility and bearishness hit small-caps stocks more than others should check what happened to some of them in these four months of correction. Small-cap stocks do have a higher element of risk. But if you take care of a few things before investing, it will go a long way in ensuring that you get that extra return for the extra risk taken. Also, understand a simple fact. Small-cap stocks are highly volatile, with price swings amplified by limited trading volumes. So, when they are rising don’t assume that it is all about fundamental improvement in the business and vice versa. Like other parts of the markets, even the small-cap space is witnessing correction. This time, however, it is more orderly as compared to the past. What can change things, is global risk off trade. If there is a bout of selling which comes because global equity markets get into risk off mode (as they did in early August 2024) then ever...

[hfe_template id='11223'] [ad_1] Synopsis After many months or one may even say that after a gap of a year, Indian markets got a reminder that global markets also matter. But there are some good learnings from this week's episode. After all the volatility we are still the best performing market, so bears will have to wait before they can make any serious attempt to control the street. But because valuations are high, it would be better to still be cautious both the amount of exposure one is taking and more importantly the stocks which one is buying should have good fundamentals and the score should have seen some improvement. These selected stocks depict a strong upward trajectory in their overall average score. This implies that there has been a significant improvement in their market outlook in the given time frame. In the last one week, after all the volatility, it was market breadth which stood out even more than the absolute movement of both nifty and sensex. Ex...

[hfe_template id='11223'] [ad_1] Synopsis Indian markets are correcting in line with the global markets. How long this phase will continue is an open ended question because when will the US Fed act is something which is still not clear at this point. If one looks at the Indian market, just before this global issue came up they have been doing well, both in terms of the performance at the level of Nifty and broader market breadth which has not been that bad as it used to be in March when it was Indian specific correction. The way things are panning out even in this correction, the probability that Indian markets will be able to outperform global peers seems to be high at this point of time. So, in a way these corrections are opportunities for a medium to long term perspective but only if you buy stocks where they meet certain parameters, especially in small cap segments where risk and reward are of different nature. In a week when Nifty and sensex have witnessed big cuts ...

[hfe_template id='11223'] [ad_1] Rising expectations that former President Donald Trump will regain the White House in November are supercharging the so-called Trump trade, on views that his policies will lift corporate profits even while spurring worries about the country's long-term fiscal health. The two sides of the trade have been evident in recent weeks, as investors price in greater odds of a win by the Republican challenger following a disastrous performance by President Joe Biden in a late June debate and after last weekend's assassination attempt on Trump. Stock investors are leaning into corners of the U.S. equity market that could benefit from proposed Trump policies such as tax cuts and regulatory easing, including small caps and energy shares. Those preferences - along with expectations that the Federal Reserve will cut interest rates in coming months - are fueling a rotation out of big technology stocks and into less-loved areas of the market. Tre...

[hfe_template id='11223'] [ad_1] The Nasdaq ended sharply lower on Thursday, hit by losses in Nvidia, Apple and Tesla as investors rotated into smaller companies after softer-than-expected inflation data fed bets the Federal Reserve will cut interest rates in September. The S&P 500 also lost ground after a Labor Department report showed U.S. consumer prices fell unexpectedly in June and the annual increase was the smallest in a year, drawing the Fed closer a September rate cut. The Dow finished with modest gains. Interest rates futures suggest traders see an over 90% chance the Fed will cut rates by its September meeting, up from about 74% on Wednesday, according to CME Group's Fedwatch. Despite signs of receding inflation, Wall Street's most valuable companies lost ground, with Microsoft and Amazon each losing more than 2% and Meta Platforms dropping about 4%. Tesla tumbled 8.4%, its biggest one-day percentage drop since January, after Bloomberg News repor...