Sector and stock rotation in the market is happening at a rapid pace, driven by fear of missing out and lack of conviction. This article explores the reasons behind the non-linear market in 2024, including earnings risk, earnings dispersion, and interest rate outlook. It analyzes the impact on earnings growth, sales growth, and stock performance, and highlights the dominance of retail investors in shaping market trends.
A disruption in oil and gas shipments from West Asia looks improbable at this point of hostility between Israel and Iran, but it could lead to inflationary pressure as speculators play on risk premia to keep prices on the boil. Benchmark Brent had surged past $90 per barrel in the wake of Iran’s April 13 missile attack on Israel but soon slipped to $87. On Friday, Brent declined further to $86.4 after Tehran played down reported Israeli attacks on Isfahan, raising hope against escalation of hostilities in the region.
Indian benchmark indices, Sensex and Nifty, are trading listless after an extended weekend, with analysts predicting market volatility ahead of the monthly F&O settlement.
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Financial expert Venugopal Garre advises investors to book profits in a range-bound and volatile market in the near term.
Market watchers predict sustained volatility for Treasuries due to economic factors and geopolitical tensions. Swings in long-term rates are surpassing those in equities. The Fed’s struggle to indicate a clear vision for interest-rate policy contributes to uncertainty. Geopolitical factors and a surge in debt supply are further impacting market instability.
