Earnings is the key in this stock picker’s market, says Mayuresh Joshi
Mayuresh Joshi, Head-Equity, Marketsmith India, says global circumstances, including Trump's potential return to office and global inflation trends, are largely beyond our control. While recent data showed some improvement, uncertainty remains, particularly regarding its effects on bond yields and interest rates. Currently, the situation is inconsistent, and corporate earnings may continue to weaken, posing challenges for emerging markets. A selective approach is essential this year, focusing on specific sectors and individual stocks, making it a market driven by stock selection.
We can safely say we are out of the woods once a large chunk of earnings is behind us because that, in some sense, is the true litmus test?
Mayuresh Joshi: Absolutely, right. Out of all the large emerging markets that we track, earnings is going to be a big concern, and specifically because of that, earnings downgrades. India, Hong Kong, and China are something that we put under pressure as far as the market outlook is concerned. And therefore, how this earnings season plays out specifically and what corporates have to say in terms of the outlook ahead for 2025 is going to be extremely critical.
Obviously, the global conditions are beyond our control and that includes what Trump does once he resumes office, what happens to global inflation, and what happens to core inflation within that data points. The number in yesterday's reading came out relatively better. But generally, what is the trend? How will that play out on bond yields, and
