Dalal Street Week Ahead: AUGUST 3RD Week | 2024 | P R Sundar
Summary
TLDRIn the 'Street Week Ahead' program, P Sund discusses the turbulent global markets, with the Japanese market falling over 10% and US markets crashing, affecting Indian markets as well. Despite the volatility, markets are stabilizing as Japan halts interest rate hikes and US economic data improves. The focus shifts to inflation data, with Indian and US reports expected. Sund dismisses the impact of the Hindenburg report on the stock market, as allegations against the Adani Group are not expected to cause a second shock. He predicts a normal market reaction, with retail and mutual fund investments supporting market stability.
Takeaways
- π The last week was a brutal week for global markets with significant drops, especially in the Japanese market which fell over 10%.
- π Despite the initial downturn, markets are showing signs of returning to normal with Japan announcing no further interest rate increases and US economic data not being as bad as previously reported.
- π Geopolitical tensions between Iran and Israel are not escalating, which is helping markets to stabilize.
- π This week, markets will be focusing on various economic data releases, including Indian inflation data and US producer price index, consumer price inflation, and retail sales data.
- π‘ The speaker does not expect the Hindenburg report to have a significant impact on the stock market, as markets typically do not react to the same bad news twice.
- π The first allegation against Adani caused a shock and a drop in the market, but the second allegation is not expected to have the same effect as the market has already adjusted to such news.
- π€ There was speculation about who the Hindenburg report would target, but now that it's released, other companies like Reliance and HDFC Bank are safe from unwarranted selling pressure.
- π Adani Enterprises' stock has underperformed, falling over 10%, while the Nifty has risen by nearly 8% since the election results, suggesting insider knowledge of the report may have influenced the market.
- π° The speaker predicts that as long as retail money continues to flow into the market and mutual funds, the market will not fall significantly despite any allegations.
- π The speaker suggests that the market opening might see some reaction to the Hindenburg report, but overall, it will be a normal market day.
- π The speaker will provide more insights in a pre-market report the following morning, indicating ongoing analysis and updates.
Q & A
What was the market situation described in the script for the last week?
-The last week was described as brutal for global markets, with significant falls in the Japanese market by more than 10%, followed by a crash in US markets, and a subsequent impact on Indian markets with a gap down of about 300 points. The market experienced high volatility with large daily gaps up or down.
Why did the speaker forget to do the 'Street week ahead' program last week?
-The speaker forgot due to being preoccupied with a workshop in Chennai and only remembered just now, indicating a last-minute realization and preparation for the program.
What economic developments were mentioned as reasons for the market recovery towards the end of the week?
-The recovery was attributed to Japan's announcement of not increasing interest rates further, better-than-expected US economic data, and the de-escalation of geopolitical tensions between Iran and Israel.
What financial data will the markets be focusing on during the week discussed in the script?
-The markets will be focusing on various inflation data releases, including Indian inflation data on Monday evening, US producer price index on Tuesday, Consumer Price inflation data on Wednesday, and retail sales data on Thursday.
What is the speaker's view on the impact of the 'Hiden' report on the stock market?
-The speaker does not expect any significant impact from the 'Hiden' report on the stock market, as markets typically do not react to the same bad news the second time around, and the report's allegations are the second time they are being made against the Adani group.
What was the speaker's famous statement regarding market reactions to news?
-The speaker's famous statement is that markets do not react to the same bad news the second time. The first occurrence is a shock and a surprise, but by the second time, the market has already factored in the news.
What is the speaker's opinion on the allegations against the 'SE CH person' and their potential impact on the stock market?
-The speaker believes that the allegations against the 'SE CH person' will not affect the stock market because they are an individual and their investments in Adani group stocks are not significant enough to impact the market.
Why did the speaker suggest that Reliance and HDFC Bank would not be affected by the 'Hiden' report?
-The speaker suggested that Reliance and HDFC Bank would not be affected because the 'Hiden' report was released, clarifying that the allegations were not against these entities, and thus, they would not come under selling pressure.
What was the speaker's previous advice regarding Adani group stocks and Nifty before the parliament election results?
-The speaker had advised to short Adani group stocks and go long in Nifty before the parliament election results, anticipating a favorable government outcome.
How does the speaker explain the underperformance of Adani stocks despite a favorable government?
-The speaker suggests that the underperformance might be due to insiders already knowing about the allegations and that this information could have been reflected in the market prices, causing Adani stocks to fall while Nifty went up.
What is the speaker's prediction for the market's reaction to the 'Hiden' report release?
-The speaker predicts that there will not be a significant market reaction to the 'Hiden' report release, as it is the second time allegations are being made, and the market has already adjusted to such news.
Outlines
π Global Market Turmoil and Recovery
The video script discusses the dramatic events of the previous week in global markets, highlighting the significant drop in the Japanese market by over 10%, which triggered a similar reaction in the US and Indian markets. The script mentions the volatility experienced throughout the week with daily gaps of 200 points up or down. Towards the end of the week, the situation seemed to stabilize as Japan announced no further interest rate hikes and US economic data was not as poor as previously feared. Geopolitical tensions between Iran and Israel did not escalate, allowing markets to slowly return to normalcy. The script also touches on the upcoming focus on inflation data and the expectation of lower inflation figures. It addresses the second allegation against the Adani Group and the presenter's belief that it will not significantly impact the stock market, as markets do not react to the same bad news twice. The presenter suggests that insider information may have already been factored into the market prices.
π Market Outlook Amidst Allegations and Speculations
In the second paragraph, the script provides an outlook on the market's expected behavior in light of the Hidden B report and other financial data releases. The presenter dismisses the idea that the report will have a significant impact on the market, comparing the reaction to a ghost that loses its scare factor upon repeated encounters. They emphasize that the market has already priced in any potential insider information related to the report. The focus is on the continued retail money flow into mutual funds, which are capable of purchasing substantial amounts of stocks, thus supporting market stability. The presenter predicts a normal market reaction, dismissing the possibility of a lower circuit and suggesting that any morning sell-off would be short-lived. The script concludes with a teaser for a more detailed discussion in the pre-market report the following day.
Mindmap
Keywords
π‘Street week ahead program
π‘Global markets
π‘Volatility
π‘Interest rate
π‘Economic data
π‘Geopolitical tension
π‘Inflation data
π‘Producer price index
π‘Retail sales data
π‘Adani Group
π‘Insider information
π‘Open interest
π‘Mutual funds
π‘Lower circuit
Highlights
Introduction to the last Street Week Ahead program sponsored by Delta Exchange.
Apology for delay due to a workshop in Chennai.
Description of a brutal week for global markets with significant falls in Japanese and US markets.
Indian market's reaction to global market crashes with a 300-point gap down.
High volatility in the Indian market with daily 200-point gaps up or down.
Normalization of market conditions towards the end of the week.
Japan's announcement of no further interest rate increases.
US economic data not as bad as previously reported.
Geopolitical tensions between Iran and Israel not escalating.
Market focus on upcoming inflation data throughout the week.
Expectations of lower inflation and its impact on market reactions.
Discussion on the second allegation against Adani and its potential market impact.
Clarification that the Hidden Back report is not expected to significantly affect the stock market.
Speculation about the Hidden Back report's target prior to its release.
Relief that the Hidden Back report did not target Reliance or HDFC Bank, which have significant weightage in Nifty.
Analysis of Adani Enterprise's stock performance in contrast to Nifty's rise.
Market anticipation and potential overreaction to the Hidden Back report's release.
Assessment of the market's open interest and its resilience to allegations.
Prediction of a normal market reaction despite the Hidden Back report.
Final thoughts on the Hidden Back report's minimal impact and the market's stability.
Transcripts
this is p Sund welcome to the last
Street week ahead program sponsored by
delta.
exchange apologies actually because of
my chenai workshop I forgot actually so
just now I remembered I thought maybe
I'm late I'll do it okay the last week
was a brutal week for the global markets
on Monday Japanese Market fell more than
10% us markets also crashed and because
of that Indian markets also fell and
then Indian market gap down about 300
point then after that you know it was
going up and down you know with a huge
volatility the last whole week every day
there was either 200 Point Gap up or 200
point gap down so but it was just
consolidating but now towards the end of
the week you know things are looking
normal and Japan you know they have
already announced that they will not be
increasing any more interest rate and US
economic data they are not that bad
because the previous Friday the data was
very bad that why that's why the markets
are sold into and then the geopolitical
tension in Iran Israel also they are not
escalating so the things are slowly
clawing back to the
normal
now uh this week markets will be
focusing on inflation data on Monday
evening Indian inflation data will come
late dat the US like on Tuesday there
some producer price index Wednesday
there is Consumer Price inflation data
Thursday some retail sales data so this
week you know us markets will be
focusing on the data and Indian markets
you know they don't react much for the
inflation data but then inflation is
expected to be
lower now coming back to the important
thing everybody is talking about hiden
back
report okay um I can tell you I not
expect any big impact in the stock
market you remember my famous statement
markets do not react for the same bad
news second time first time when
something happens it's a shock it's a
surprise second time comes okay this is
what is going on so first time there was
an allegation against adani you know it
was a shock you know know stocks fell
markets fell but now it is once again
it's a allegation against adani although
it was about targeted at se person but
SE CH person invested in ad group stocks
only so that was the allegation so
anyway C person is an individual person
you know anything related to her is not
going to affect the stock market but
adani group is a listed
company so if you take this as an
allegation this is a second allegation
against adani so I don't think that
there will be any
impact and not only that you know it is
good that you know hidden BG has
actually uh release the report otherwise
people people were speculating was it
against Reliance was it against HDFC
Bank you know so you know if the if the
report had not come then you know Monday
uh Reliance would have come under
selling pressure HDFC bank would have
come under selling pressure but at least
now they released it okay now we are
safe now it is not Reliance Reliance
will not be affected not HDFC bank that
will not be affected because these two
stocks together has about 25% weightage
in Nifty right so as I told you ad
stocks probably some insiders know this
news
already rightwise how the hidden be gets
the report somebody from you know
Insider information they would have
passed on the information at least that
person would have told some people that
is already reflected in the market and
if you can remember you know just about
uh two to three weeks before the
parliament election W counting I said
you know I would like to sh other any
group stocks and like to go long in
Nifty and you know if you look at the
prices as of 31st
May uh from that day to today ad
Enterprise has fallen more than
10% whereas Nifty has shot up nearly
8% so you know uh a favorable government
has come in the center okay logically ad
stock should have
shter right uh but you know well the
Nifty is going up 7 8% ad stocks were
down now I was thinking you know
probably BJP did not get the full
majority so they got only 240 seats I I
thought that would be the reason for
underperformance of the stocks but
probably this was going around you know
in the informed circles so therefore you
know adx already been underperforming
and second thing you know this
allegation is a second time first time
it'll be shock second time no nothing
right so even you look at the ghost
first time you'll be scared second time
you know you are not scared third time
you become a friend okay so that is how
things work in stock
market right so uh looking at the open
interest you know um it looks like you
know it's going to be 24,000 to
25,000 and no matter what allegation
comes no matter what happens as long as
the retail money is flowing into the
market flowing to the mutual funds and
mutual funds are getting 30 40,000 CR so
on an average they can afford to buy
1,500 to 2,000 CR worth of stocks how
this Market is is going to fall right so
uh overall you know uh the hidden B
report is not going to have any big
impact as people are expecting you know
I find some people you know tweeting sir
they can there be a lower circuit you
know forget about the lower circuit okay
You' be happy if Nifty Falls by 1%
tomorrow I don't think that that's going
to happen of course in the morning 9:15
there may be some need reaction you know
there may be some selling and other
stocks but overall you know it's going
to be a normal market right so harly I
just uh started talking I didn't have
much information so we will talk more
tomorrow morning in the pre market
report hope you enjoyed watching this
video thank you for watching
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