“Despite robust macro and healthy earnings trajectory India cannot stay fully immune to global factors,” says Kedar Kadam, Director — Listed Investments, Waterfield Advisors.
In an interview with ETMarkets, Kadam said: “In our view, one should stay put and use the market declines to add more in a staggered manner from a 3-4 years perspective” Edited excerpts:
We have seen some correction from the highs in both Sensex and Nifty. What is fueling the fall – is it the combination of rise in US Yields and geopolitical concerns?
I reiterate my earlier stance, despite robust macro and healthy earnings trajectory India cannot stay fully immune to global factors.
A mix of global and local factors is driving the current correction in markets. The global factors are –
1) Uncertainty ahead of the US Fed meeting in early Nov-23 and the recent spike in US treasury yields to over 5%
2) Upmove in the USD index (~106)
3) Geopolitical concerns & resultant volatility in commodity prices especially Crude oil and the global supply chain
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4) Sluggish global recovery, with growing regional divergences.
Domestically influencing factors are
1) Slower than anticipated recovery in rural demand
2) Below average monsoon and resultant sluggish kharif acreage (food inflation remains a key risk)
3) Higher domestic interest rates and subsequent rise in cost of capital
4) Volatility ahead of