Indian banks are in a better position than those of the US and Europe.

Category : Knowledge Center

Introduction: Seeing the present situation of the market globally, some market experts have warned that the slowdown in Nasdaq companies could have repercussions on Indian companies' earnings. They believe that the IT sector is facing significant headwinds due to the state of the sector worldwide and the banking sector's recent troubles. They also stated that the banking consolidation in the US and Europe could severely impact the IT sector's prospects. Thus, investors should be cautious when allocating funds to this sector. However, they also stated that Indian banking is in much better shape than it has ever been, with strict regulatory controls bringing about the required discipline in lending. Therefore, they do not foresee a collapse like the SVB occurring in India.

Experts take on investing in pharma sector stocks: As a momentum practitioner by some market experts, they say that it is important to pick stocks with strong momentum in a sector before adding them to a portfolio. However, currently, the Pharma sector index is at a low point and has shown disappointing trends, except for a brief surge during the COVID pandemic. Nonetheless, the experts said that a non-professional investor should not try to time the market and should continue to invest or gradually deploy capital. They also suggest that starting to invest at any point, even at the top of the cycle, does not significantly harm long-term outcomes. Therefore, the best time to start investing is always yesterday, but if that was missed, the second-best time is today.

 Expert View on IT Sectors according to current market situation: Market experts suggest that there are significant challenges faced by the IT sector globally, including potential troubles in the banking industry that could impact the earnings of IT companies. As a result, investors should be cautious when allocating funds to this sector. However, the experts believe that despite these challenges, some mid-tier IT stocks have shown strong momentum and are hitting new highs, meeting the criteria for inclusion in momentum portfolios. They further highlight that the portfolios remain sector-agnostic and will only retain these stocks as long as they meet the portfolio criteria.

Experts view on the recent banking crisis in the US and Europe and its effect on global banking: Market experts suggest that there is a potential for a contagion (casual) effect in the financial system, based on recent events such as top Swiss banks being taken down and smaller US banks requiring bailouts. The vulnerability of the system is highlighted, and any loss of confidence in a financial institution can quickly lead to stress and the breakdown of other holding institutions. The experts also said that it will take a quarter or two to determine if there will be a domino effect from these events and if the storm has passed.

Experts view on Indian banks after SVB Bank collapse: Market experts suggest that the Indian banking system is in a better state than it has been in the past, with strict regulatory controls bringing discipline to lending practices. They also said that even PSU (public sector undertaking) banks are emerging from a difficult period and are looking to build on their current position. At present, they do not foresee a collapse situation like SVB (Silicon Valley Bank) occurring in India.

Experts view on expected rate hike by Fed: Market experts suggest that the Federal Reserve is in a difficult situation due to inflation and the job market. If the Fed tries to control inflation at any cost, they may have to continue raising interest rates, which could lead to a recession and institutional collapses. They believe that the interest rate cycle has already peaked and that the only way forward is to print more currency and embrace higher inflation. They also suggest that the solution to this problem is to hold interest rates at their current levels for the long term and to recapitalize balance sheets by revaluing the gold on central banks' books.

Experts view on investment strategies as per the current market outlook: Some market experts suggest that the investment strategy is non-discretionary and based on momentum. They are not worried about the markets because they know that once momentum returns, their portfolio will automatically shift to market leaders, and there will be no need for a forced sectoral view. However, from an asset allocation perspective, they recommend exposure to gold, and many investors have benefited from investing in this sector.

Conclusion: At present, experts do not feel any dangerous situation prevailing in the Indian banks as well as in the market, but they are encouraging investors to invest more as they believe this to be the best and most suitable situation arising in the market. Also adding to this contest, they feel that in the present situation rate hikes are necessary to be increased in order to get victory over the inflation situation, which is presently becoming a headache situation for the market, where they were once feeling that the Fed should pause their rate hikes from here. Overall, the situation for Indian banks and markets is favourable. So, start your investment journey with Libord brokerage Pvt Ltd by opening a demat and trading account.