Indian share market are closed for trade on Tuesday, August 9, on the occasion of Muharram. Currency and derivatives markets will also remain shut for trading There will be no action in Equity Segment, Equity Derivative Segment and SLB Segment, according to the list of stock market holidays 2022, available on the official BSE website - bseindia.com.
However, commodity markets will observe holidays only during the morning session, that is, 9 am to 5 pm on Tuesday but the trading will happen in the evening session on Tuesday.Current valuations provide a good entry point for long-term investors. At current levels, stock picking and sector rotation would be keys to achieving outperformance," domestic brokerage Axis Securities said in its monthly strategy report.
Stating that the calculation of its India Valuation Index is based on four fundamental market parameters - 12m fwd PE, 12m fwd PB, Bond Equity Earnings Yield Ratio, and Mcap to GDP Ratio - the brokerage said in terms of m-cap to GDP, India is less expensive than the US market.Wall Street closed mostly flat on Monday after blockbuster jobs data last week reinforced expectations the Federal Reserve will crack down on inflation, while a revenue warning from chipmaker Nvidia reminded investors of a slowing U.S. economy.
Meanwhile, Asian shares were down on Tuesday as financial markets fretted about persistent global cost pressures, with investors turning their focus this week to U.S. inflation data and the prospects for further aggressive Federal Reserve rate hikes.Analysts from the brokerage house are overweight on domestic themes ahead of the upcoming festive season. The profitability of Indian corporates is likely to shift from commodity producers to commodity consumers, they said, while maintaining an overweight stance on equity.
(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of Economic Times)Among other stocks, French utility company Veolia rose 3.3% as it confirmed it would sell Suez's UK waste business to Australia's Macquarie Group Ltd for around 2.4 billion euros ($2.4 billion). (Reporting by Shreyashi Sanyal in Bengaluru; Editing by Sriraj Kalluvila)That's the view being expressed in a new note by Michael Wilson, chief U.S. equity strategist and chief investment officer for Morgan Stanley. He's in agreement with much of Wall Street that inflation has likely peaked for now. Where he differs from some is what he thinks that means for the markets. Mr. Wilson believes falling inflation will actually hurt profits in the coming quarters because of two words: operating leverage.
Put simply, operating leverage refers to the degree to which a company's costs affect its revenue growth. Early on in the pandemic, operating leverage was positive. Companies' sales grew faster than their expenses as pandemic-related lockdowns and the ensuing reopening ratcheted up demand for all sorts of goods and services. That helped earnings surge, which in turn helped the stock market take off.
Now, inflation looks like it may be easing up. Mr. Wilson says that will likely send operating leverage the other way. (Think: companies won't have as much demand for their goods and services, or be able to charge as much for them.) Mr. Wilson's take? "Falling inflation will essentially have the exact opposite effect on profits that rising inflation did in 2020-21."
Stock prices don't always move the same direction as earnings. But corporate results are an important factor in the market's ebbs and flows, and where Mr. Wilson is concerned, the current economic backdrop doesn't bode well for future earnings.
"We think it's premature to sound the all-clear simply because inflation has peaked," he said in his note. In fact, "with valuations this stretched, we think the best part of the rally is over."
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