Indigenous Investors Weekly Insights!
Top 3 well curated stories from the stable of Indigenous Investors incase you missed them. These can range from finance to sports, depends on what made the headlines. Stay tuned.
At Indigenous Investors, we pride ourselves on a simple but powerful habit: reading for 5 hours every single day. It’s something we’ve shamelessly borrowed from the Oracle of Omaha, Mr. Warren Buffet. To share the wealth of knowledge we uncover, we’re bringing you 3 top stories that you may have missed this week. If there’s a topic you want us to cover, drop us a line! We’re always excited to read more and refine our process.
Story #1: Gold prices slip to 8 month lows (click here)
Gold prices have slipped from their highs of early November, 2024 to below 74,000 per gram, shedding over 4% in the week. Simultaneously, we are also witnessing a rise in US treasury yields and the surge in bitcoin prices that have now crossed USD 93,000 per coin. Various other reasons are also highlighted for such a fall for the precious metal like de-escalation of wars between Russia-Ukraine and Middle East but the bottom line is attributed to only one person, the POTUS Donald Trump and the prediction of favourable policies out of the White House.
Story #2: Brokerage firm CLSA shifts focus back to India from China (click here)
The FIIs have continued their journey back elsewhere with further INR 22,000 crores out of the Indian markets. However, CLSA has turned to be an outlier by shifting their focus back to India. While they acknowledge the sky high valuations of quality Indian companies, the expectations of escalating trade wars between Trump 2.0 USA and China while also noting that the stimulus packages offered by Chinese government are not enough.
In such a tense market, it pays to be active as much as it pays to remain passive. When nobody knows anything, success will be determined and narratives will be written by those people who are able to throw knives at a plain wall and making circles around it.
Story #3: The long wait for rate cut continues… (click here)
Finally an article from the main press that deeply resonates our view on rate cuts. While we have understood that the move of RBI to increase the repo rates was more to do with maintaining the balance of payments by maintaining the exchange rates since India is a net importing country, the higher rates have come at the cost of slowing growth that is visible now. It is said that there was a 29.5% YoY decline in new investment announcements and a 53% YoY fall in project completions in H1FY25.
Even if you read the minutes of MPC (Monitory Policy Committee), most of the high inflation is attributed to food, which has a relatively inelastic behaviour against interest rates. However, it is apparent that the costs of high rates are outweighing the benefits and a rate cut will be highly appreciated from all corners of the economy.
In such turbulent times, it has become extremely important to make sure your money is invested at the right places. You can read our article on Portfolio Reshuffling (click here) to get professional insights into managing your wealth.