FMCG and overvalued defence stocks could face near-term challenges: Gurmeet Chadha
«Our GDP numbers came lower. If you see the corporate tax collection growth which the data came, it is just about in high single digit, that shows that even the earnings going forward may not see any meaningful upside,» says Gurmeet Chadha, Complete Circle Consultants.
Help us with your take on the markets. How do you see the weakness and especially the weakness that we are seeing on the broader markets? Do you believe that we could be in for some more weakness from these levels?
Gurmeet Chadha: So, if you see, I made this point in our previous interactions, whenever the bond yield in US surges, whenever the dollar index crosses 107, I think we see heightened volatility, which again is the case.
That is why the pullback is now getting sold into. More to it is also our own internals. Our GDP numbers came lower. If you see the corporate tax collection growth which the data came, it is just about in high single digit, that shows that even the earnings going forward may not see any meaningful upside.
And FIIs and near-term money chases growth and momentum and that is why the money went to US. So, it is more our internals which has created a little more volatility in the last few days or so. But as I said a lot of it is also cyclical.
So, this is not a market to really thump the table and say this is the bottom and let me all in, but there are opportunities coming. At some point in time, even some mean reversion will happen from US also. US market cap is now 70% of the world market cap. Their GDP is just 26-27% of the
