Ceasefire and trade peace signal a turning point for market stability: DP Singh

Economic Times

12-05-2025

ETMarkets.com So, naturally the find in those sectors will be more.
"We hope that business will be as usual now and see, of course, we being the long-term player, the mutual funds always being the long-term player, so we will not be looking at any trading opportunities, but yes, a big-big positive for the markets," says DP Singh, Deputy MD, SBI MF.
What better news this weekend firstly on India front, the fact that both the countries have agreed to a ceasefire must bring a lot of relief to investors as well because we did see markets fairly jittery last week.
DP Singh: Yes, of course, it is a big-big relief for all the investing community and see, of course, nobody wants a war, conflict, kind of situation because that not only impacts the sentiments, it impacts the economy also in a big way. It has come as a relief. So, we hope that business will be as usual now and see, of course, we being the long-term player, the mutual funds always being the long-term player, so we will not be looking at any trading opportunities, but yes, a big-big positive for the markets.
And the other hand, of course, there is also news that US and China could have finally struck a trade deal on tariffs. The announcement, of course, and the nitty-gritties and the nuances will be announced when they hold a press conference later today our time, but that is where you think a big overhang gets lifted from the market minds?
DP Singh: Yes, because see a growing economy like ours always gets benefited by the overall stable situation across the globe and these kind of jittery conditions what were prevailing between us-China and so many other places, that is likely to be over very soon and we should concentrate on our businesses, we should concentrate on what we have done with UK, what we are doing with USA, those kind of positives we will look forward from now onwards. Hoping that that everything will be calm peaceful at the Indo-Park borders, it is a moment to move on with positivity. Help us understand what should be the strategy for the Indian investors right now. Well, of course, a lot of moving parts when it comes to the geopolitical situation turning up, but on the flip side, a lot of positive too, like we were highlighting the global cues are turning positive. We have that India-UK trade deal that went through. How should investors place their bets?
DP Singh: See, as usual, we always say that investors should continue investing money in Indian market for a long-term perspective and that golden rule continues.
We have seen some of weaknesses, of course, whatever will be there will be analysed over the period of time. So, this is the point, this is the moment to consolidate, and see investors should continue to put in money. You have seen the last month's number.
The SIP investors have continued to put in money, but for the big ticket, the HNI investors and the lump sum money which was awaiting us, I hope that those kind of moneys will also start coming into the market now.
What is your own analysis, where do you think money or money will find its way and where do you think money is to be made because up until now what one has seen is that there is almost a consensus towards banks, but do you think there will be some bottom-up stories? There is some clarity coming in on pharma tariffs as well. Do you think maybe bottom-up under-owned sectors will now make a comeback?
DP Singh: It is very difficult to talk about the sectors, but bottom-up stories are always there. There are good companies with the good management, good growth perspective which remain across the sectors and we as the fund house always look for those opportunities. It depends upon how strong, how competent your research team is. There is a way to go and find out the good companies and start investing in the infancy stage to create wealth for the investors. And I am very confident that we are the ones who can do it. The mutual industry overall has got a very-very strong research bias. For the investors looking at the mutual funds is a way to go forward. But only thing is that the number of listed companies is little, something which is us. We need more and more listed companies. And as per the regulations we can invest only in the listed space, so that is something which we are working on along with the regulator as an industry also, how more and more companies can be brought into the public space. It is all positive, win-win for the investors going forward.
Investors after the correction which played out until the month of March had gotten very weary and pretty much everyone was taking concentrated moves within largecaps. Do you think it is now time to shift some allocation to small and midcaps or do you think largecaps and flexicaps are still the way to go?
DP Singh: As I told you that this sector specific, same way cap specific also it is very difficult to take a call, definitely because number of companies are more in mid and smallcap. So, naturally the find in those sectors will be more. So, it is better to be into the flexicaps or multicap kind of funds which have both largecap, midcap, mid and smallcap and to some extent in multi-asset allocation fund commodities as well, it is better to play that game rather than getting into only smallcap, midcap, or only the largecap fund. Let it be done by the experts who are there in the fund houses and they will take care of it.