India-Pakistan conflict: How should mutual fund investors deal with geopolitical threats?
Live Events
With the ongoing India-Pakistan conflict after the Indian Armed Forces' precision strike on terror camps in Pakistan and Pakistan-occupied Kashmir (PoK), the mutual fund investors are recommended to stay invested and avoid knee-jerk decisions, according to a release by Kotak Mutual Fund 'It is difficult to predict the market direction however, the last major conflict has triggered temporary drawdowns before markets rebounded. Staying invested and avoiding knee-jerk decisions may be prudent for long-term wealth creation,' Said Kotak Mutual Fund.The fund house recommends that investors investing via SIP can consider topping up their ongoing SIP if possible, and should not exit from the existing SIP, whereas the investors making lumpsum investments may consider adding investments in a staggered way, and should not sell in panic.While sharing how the current conflict could play out on the economy and markets, the fund house said that if it is a prolonged conflict then macro-economic variables such as inflation and fiscal deficit could increase, and markets may correct further.On the other hand, if there is no conflict or a conflict for a limited period, the impact on the economy will be limited, and even the markets may stabilize.There have been two such surgical strikes since 2016 (Uri and Balakot) and the impact on the market has been limited.During the Uri Surgical Strike, which was between 18-28 September 2016, the market dropped by 0.3% from the day of the attack till the strike, and on the day of strike, it went up by 0.4%. One year after the strike, the markets surged by 11.3%, the release said.At the time of the Balakot Airstrike, which was between 14-26 February 2019, the market went up by 0.8% from the day of the attack till the strike and on the day of the strike, it went down by 0.4%. One year after the strike, the markets surged by 8.9%.'Government action suggests there is low possibility of a war. However, in case of a full-blown war, we must note that since 1950, India has seen 4 major wars. In the last major conflict (Kargil-1999), the equity markets have remained robust after an initial panic,' the release said.According to the release by Kotak Mutual Fund, at the time of Kargil War, which went on between 3 May to 26 July 1999, the market dropped by 8.3% just one month before the war and during the war, it surged 36.6%. After one year of the war, the market gained 29.4%.'Short term market swings during geopolitical events are unsettling, but history shows that they rarely derail India's long term growth story. In the long term, the macroeconomic factors and corporate earnings drive the stock market performance,' said the fund house.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
India Gazette
9 hours ago
- India Gazette
"Pak Generals want conflict, terrorists are their tools": Ravi Shankar Prasad in Berlin
Berlin [Germany], June 7 (ANI): BJP MP and leader of the all-party delegation Ravi Shankar Prasad on Saturday sharply criticised Pakistan's military establishment, asserting that its Generals orchestrate conflicts to remain relevant, using terrorists as tools to destabilise India. During a community event with the Indian diaspora in Berlin, Prasad highlighted India's remarkable progress in IT, space, and digital transformation under Prime Minister Narendra Modi's leadership, contrasting it with Pakistan's repeated failures in wars while referring to the repeated incidents of Pakistan-sponsored terrorism and the military's dominant role in the country's politics. 'India and Pakistan were born the same day. Where are we in India, and where are they (Pakistan)? India has become a major global IT power in the world. India has become an emerging space power in the world. The startup movements here are now globally recognised. India has also become the second biggest mobile phone manufacturer in the world. We have brought digital transformation with equity and justice,' Prasad said. 'What Pakistan is doing is creating terror machines. How to create world-class terrorists under their (military) Generals. They attacked us four times and lost every time. We never attacked; they were the ones who always started the war. It is because they are under the control of Generals and not political leaders. Generals want conflict to keep themselves relevant, and terrorists are the instruments through which they execute. Wherever there is a terrorist, either he is a Pakistani or trained in Pakistan,' he added. He emphasised India's economic achievements, including a 51 per cent share of global digital payments and its status as the second-largest mobile manufacturer, attributing this to PM Modi's 2014 vision of 'IT+IT=IT' (Information Technology + India's Talent = India Tomorrow). 'Prime Minister Narendra Modi used to say in 2014 that if he became the PM, he would make an India where IT+IT=IT, which means Information Technology + India's Talent = India Tomorrow. Digital payment in India is at 51 per cent of the world,' the BJP MP stated. Prasad also spoke about the April 22 Pahalgam terror attack and India's decisive response through Operation Sindoor on May 7, noting that Operation Sindoor remains paused but ready to resume based on Pakistan's actions. 'Pahalgam attack happened on April 22. We attacked on May 7 and hit the terrorist camps. If Pakistan has to talk, it must directly speak to us. Our message was stern and straight: If you stop, we stop. If you fire, we will give a stronger reply. Operation Sindoor is on pause, subject to the good behaviour of Pakistan. It has not ended,' he stated. The delegation, led by Ravi Shankar Prasad, includes BJP MPs Daggubati Purandeswari and Samik Bhattacharya, Congress MP Amar Singh and Gulam Ali Khatana, Shiv Sena (UBT) MP Priyanka Chaturvedi, AIADMK MP M Thambidurai, former Union Minister MJ Akbar and former diplomat Pankaj Saran. The delegation arrived in Germany after concluding their visit to Belgium to convey India's resolute and united stand against terrorism. (ANI)
India.com
11 hours ago
- India.com
After BrahMos, India's new homemade weapon will give sleepless nights to Pakistan and a warning to China, weapon is..., developed by...
New Delhi: During Operation Sindoor, the Indian Armed Forces decimated most of Pakistan's military infrastructure. One of the crucial weapons was the BrahMos missile. Now, India is preparing to launch another highly potent weapon which is an indigenous 155mm artillery shell developed by the Defence Research and Development Organisation (DRDO). This homemade 155mm artillery shell will not only add more muscle to the might of the Indian Army but also serve as a warning to China as it could strengthen India's battlefield edge from the mountains of Ladakh to the Line of Control (LoC). Four variants of this next-gen artillery ammunition have been successfully developed and tested by the DRDO over the past two years. This is a massive step forward in India's journey toward self-reliance in defense manufacturing. For a long time, India had largely relied on Russia and Israel for artillery shells, but with its own advanced 155mm ammunition nearly ready, that dependency may soon end. Nearly two feet long, these shells weigh approximately 45 kg each and their range is about 32 km. The user trials are scheduled for November this year. Upon clearance, mass production will begin for deployment across India's armed forces. Apart from enhancing India's military infrastructure, this project is also a showcase of public-private partnership in defense. Under DRDO's Development-cum-Production Partner (DCPP) model, two companies, Jai Ammunition Ltd (a Reliance Infrastructure subsidiary) and Yantra India Ltd, a state-owned firm, have been shortlisted to co-develop and mass-produce the shells. Both the companies have worked closely with DRDO over the past two years, and will now produce prototypes for the Indian Army's evaluation. If approved, it could generate large-scale orders and help reduce India's massive import bill on defense supplies. Over the next decade, India's artillery ammunition market is projected to be worth over Rs 10,000 crore. Also, given their superior technology, the shells will be considered for exports. India's reputation as the developer and manufacturer of world-class weapons at reasonable price could make India a sought-after player in the global arms market.
Time of India
13 hours ago
- Time of India
'Pakistani Generals want conflict, terrorists are their tools': Ravi Shankar Prasad in Berlin
File photo: BJP MP Ravi Shankar Prasad (Picture credit: ANI) BERLIN: BJP MP and leader of the all-party delegation Ravi Shankar Prasad on Saturday sharply criticised Pakistan's military establishment, asserting that its Generals orchestrate conflicts to remain relevant, using terrorists as tools to destabilise India. During a community event with the Indian diaspora in Berlin, Prasad highlighted India's remarkable progress in IT, space, and digital transformation under Prime Minister Narendra Modi's leadership, contrasting it with Pakistan's repeated failures in wars while referring to the repeated incidents of Pakistan-sponsored terrorism and the military's dominant role in the country's politics. "India and Pakistan were born the same day. Where are we in India, and where are they (Pakistan)? India has become a major global IT power in the world. India has become an emerging space power in the world. The startup movements here are now globally recognised. India has also become the second biggest mobile phone manufacturer in the world. We have brought digital transformation with equity and justice," Prasad said. "What Pakistan is doing is creating terror machines. How to create world-class terrorists under their (military) Generals. They attacked us four times and lost every time. We never attacked; they were the ones who always started the war. It is because they are under the control of Generals and not political leaders. Generals want conflict to keep themselves relevant, and terrorists are the instruments through which they execute. Wherever there is a terrorist, either he is a Pakistani or trained in Pakistan," he added. He emphasised India's economic achievements, including a 51 per cent share of global digital payments and its status as the second-largest mobile manufacturer, attributing this to PM Modi's 2014 vision of "IT+IT=IT" (Information Technology + India's Talent = India Tomorrow). "Prime Minister Narendra Modi used to say in 2014 that if he became the PM, he would make an India where IT+IT=IT, which means Information Technology + India's Talent = India Tomorrow. Digital payment in India is at 51 per cent of the world," the BJP MP stated. Prasad also spoke about the April 22 Pahalgam terror attack and India's decisive response through Operation Sindoor on May 7, noting that Operation Sindoor remains paused but ready to resume based on Pakistan's actions. "Pahalgam attack happened on April 22. We attacked on May 7 and hit the terrorist camps. If Pakistan has to talk, it must directly speak to us. Our message was stern and straight: If you stop, we stop. If you fire, we will give a stronger reply. Operation Sindoor is on pause, subject to the good behaviour of Pakistan. It has not ended," he stated. The delegation, led by Ravi Shankar Prasad, includes BJP MPs Daggubati Purandeswari and Samik Bhattacharya, Congress MP Amar Singh and Gulam Ali Khatana, Shiv Sena (UBT) MP Priyanka Chaturvedi, AIADMK MP M Thambidurai, former Union Minister MJ Akbar and former diplomat Pankaj Saran. The delegation arrived in Germany after concluding their visit to Belgium to convey India's resolute and united stand against terrorism.
