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Time of India
14-05-2025
- Business
- Time of India
Trump's policy shift, lower yields, and dollar weakness could revive emerging markets: Anurag Singh
"The collective basket was 3% emerging market, 15-year return Msei, but increasingly China is looking good and India always is steadily looking, it has a steady pace and it looks good as well. So, it should increase, but we need to watch a 10-year yield that is the element," says Anurag Singh , Managing Partner, Ansid Capital . So, will money come back to China given that now world is confident that US President Donald Trump has stitched up a deal with China and he is opening new frontiers like Saudi Arabia for Americans? Anurag Singh: So, on the margins we have to just keep monitoring the 10-year yield. For some reason, it is back at 4.45, but the way the sentiment is shaping up in US, if the yield touches around 4% and 3.9% and the clamour for rate cut increases, you see CPI inflation is already pretty much under control, all metrics are looking good, as long as we have more stability on the tariff side, yield should drop. The moment they go below 4%, that is good for emerging markets and the flow of money from outside US. Even the dollar has corrected now, so that is also good news in some sense. So that is my take that 10% that goes to emerging market it has not been good for the last 15 years. The collective basket was 3% emerging market, 15-year return Msei, but increasingly China is looking good and India always is steadily looking, it has a steady pace and it looks good as well. So, it should increase, but we need to watch a 10-year yield that is the element. If China gets money, India will also get money, it goes together that is how I feel about it. Live Events I go back to that basic point again which is that US markets have recovered, dollar is at 101. For next couple of days, like this short term, when I say couple of days, couple of weeks; couple of quarters, I mean not a quarter, I mean quarter or so, so could US markets outperform emerging markets? Anurag Singh: Oh, 100%. So, we are back to the point. You never say 100% for anything, first time you said 100%. Anurag Singh: Well, for this time for us, yes, because I am all in, so that is why. So, the point is earlier that what was the talk before, I mean just go one month back, the talk was that it can we give a 20 multiple to US markets. The earnings growth looking at, S&P earnings between 260, 270; give a 20-25 multiples, people were saying 5400 to 6,000. Now the 6500 to 7,000 range it will all be back in the fray. So, listen to Scott Bessent, the tariff is one element, but the other two legs which is deregulation big time on financial sector and everything else and the low taxes which is coming up in the bill, all these three legs will really push up the economy, so the best part is yet to come. So far the companies who have declared is already 14%, so 14% for the year looks pretty good. And if that comes out, S&P earnings are 280, apply a 25 multiple 6,500 to 7,000 looks good, so that is a good part. Trump has got the message. It was a bit of a self-goal and he has learnt from it ultimately. We do not know maybe 10% tariffs would stay, but good part is that the team has learnt the lesson.
Economic Times
22-04-2025
- Business
- Economic Times
Not the time for speculative bets; stick with what drives the economy: Anurag Singh
Tired of too many ads? Remove Ads Tired of too many ads? Remove Ads Tired of too many ads? Remove Ads "So, it is like exit America trade where yields drop, equities drop, and the dollar drops. So, that is how I see. I do not know to what extent this craziness would go but, obviously the president sees that if the market is not responding the way he would have thought the market would respond, he would have to take his energies out somewhere and then that comes out on the big loser guy asking the resignation of the loser guy. So, it is funny in a sense, but it is not funny really," says Anurag Singh , Managing Partner, Ansid Capital I always used to think that India has this art of inflicting self-inflicted wounds along the way, but look here we are, US can do better than that and this is where it is. This is completely self-inflicted. This is totally unnecessary and whatever be the end goal that Trump had in mind that is not happening because even at an elementary level he thought that maybe higher tariffs would result in lower yields and strong dollar. It happened for a bit, but then it did ultimately exactly the reverse is happening and that is confusing markets, that is confusing everyone. But it seems to be it is very apparent now that people are just…, some capital on the margins is leaving it is like exit America trade where yields drop, equities drop, and the dollar drops. So, that is how I see. I do not know to what extent this craziness would go but, obviously the president sees that if the market is not responding the way he would have thought the market would respond, he would have to take his energies out somewhere and then that comes out on the big loser guy asking the resignation of the loser guy. So, it is funny in a sense, but it is not funny if you look at it today, except for China everybody has 10% tariff. So, basically, whatever the damage was inflicted on April the 2nd, April 3rd that has been kind of have a 90-day reprieve. The point is market does not the president is just all and out there to destroy American companies and American markets, then how can a market trust what multiple to give to the profits and who knows what will happen, what will come out of these deals. So, the entire business community, the economic engine of US is in kind of a stalemate in terms of decision- can decide anything on this. How does a company decide how much to produce, where to import from, how to hire. So, the entire machinery is on a standstill and that is the biggest damage that we see right now and it will persist until we have very clear ramp down from this tariff, until somebody lowers down this this ratchet and takes an offramp from here.I mean let us see, but at least the markets know that the bond market has put a bottom on at least where the president comes in and kind of tries to save the markets. So, at least the bond yields the moment it crosses 4.4, 4.5, I think that becomes a worry at least there is some comfort there. But yes, in terms of US market, I still believe that US is actually the place to be. People are talking about money moving to Europe that is a dead end, Europe is not going to perform, you have got to decide where your money is going to has not performed for the past 15 years. So, my firm belief is money can go to China, money can go to India, but it certainly is not going to go to eventually US is going to prevail, on the margins I am sure India will do well and so will China. So, I mean India is likely to be a beneficiary although on the margins of the risk off manufacturing coming out of there will be some benefit, it will not be substantial, but it will be there. Aside of that, yes, India is on domestic engine, domestic economy is doing good, I mean it is not too bad relatively to the world. So, I am quite positive India will do well along with there is a long-term view on your question, there is a short-term view. Whatever the flow is coming to India, usually the trend is if the dollar weakens, it is at 98.I mean, it was 110, believe it or not like a month and a half back. So, whenever dollar weakens, money comes to emerging market. But this time dollar is weakening for a wrong reason and my sense is Chinese are dumping and even the Japanese are dumping the dollar for the time being on the margins, so that is one do not see a huge gush of money coming to emerging market, so that is the immediate short-term reason. Long-term, the trend is that Indian market, I strongly believe you can keep counting on the margins, but I am of the school of thought that the peak of FIIs holding in India happened in 12-13 which was like 22%, now it is back at 15%, it might range, go down to 12%, eventually the trend will there is such a long-term persistent trend, there is no reason that should change overnight. But domestic flow is huge. So, something has to balance out. So, that is kind of my quick take on FIIs overall level of holdings in India. In terms of what to buy, I think we had a great party for last five years on all the kind of non-performers in the economy which is PSUs and manufacturing and what not.I think we need to come back to the core of technology, banking, and FMCG because next three years in Indian market are not going to be rocking returns, they are going to be like 5, 6, 7, 8, 9, 10% returns in the market overall and so this is the time where you absorb the returns you have made for the past five years and build on in that sense you always go back to those stable sectors which drive the economy which is FMCG, banking, technology, and a bit of healthcare of course which is a rising sector and it is not a time to get into any of these fancy sectors which people tried for the last three-four years.
Time of India
22-04-2025
- Business
- Time of India
Not the time for speculative bets; stick with what drives the economy: Anurag Singh
"So, it is like exit America trade where yields drop, equities drop, and the dollar drops. So, that is how I see. I do not know to what extent this craziness would go but, obviously the president sees that if the market is not responding the way he would have thought the market would respond, he would have to take his energies out somewhere and then that comes out on the big loser guy asking the resignation of the loser guy. So, it is funny in a sense, but it is not funny really," says Anurag Singh , Managing Partner, Ansid Capital . It has not been a great morning or afternoon when you talk about the US markets, a sharp slide coming in, especially the Magnificent-7 also saw a sharp knock. How should one actually read into this and the developments day in and day out now Trump is actually targeting Jerome Powell once again? Anurag Singh: I always used to think that India has this art of inflicting self-inflicted wounds along the way, but look here we are, US can do better than that and this is where it is. This is completely self-inflicted. This is totally unnecessary and whatever be the end goal that Trump had in mind that is not happening because even at an elementary level he thought that maybe higher tariffs would result in lower yields and strong dollar. It happened for a bit, but then it did not. So, ultimately exactly the reverse is happening and that is confusing markets, that is confusing everyone. But it seems to be it is very apparent now that people are just…, some capital on the margins is leaving America. by Taboola by Taboola Sponsored Links Sponsored Links Promoted Links Promoted Links You May Like Prince William & Kate Met Princess Diana's Secret Daughter. Plays Star Undo So, it is like exit America trade where yields drop, equities drop, and the dollar drops. So, that is how I see. I do not know to what extent this craziness would go but, obviously the president sees that if the market is not responding the way he would have thought the market would respond, he would have to take his energies out somewhere and then that comes out on the big loser guy asking the resignation of the loser guy. So, it is funny in a sense, but it is not funny really. What is exactly happening when you talk about the tariffs because everyone is waiting that there will be some deal struck or no. Now you have talks that Vietnam deal may be out soon and a lot of companies that may actually end up benefiting from that. So, how should one actually read into all of these developments because it is very difficult to gauge the market right now? While yes, US markets are down and out, back home we have managed to actually scale a record high level on Nifty Bank? Anurag Singh: So, if you look at it today, except for China everybody has 10% tariff. So, basically, whatever the damage was inflicted on April the 2nd, April 3rd that has been kind of have a 90-day reprieve. The point is market does not trust. If the president is just all and out there to destroy American companies and American markets, then how can a market trust what multiple to give to the profits and who knows what will happen, what will come out of these deals. So, the entire business community, the economic engine of US is in kind of a stalemate in terms of decision- making. Live Events Nobody can decide anything on this. How does a company decide how much to produce, where to import from, how to hire. So, the entire machinery is on a standstill and that is the biggest damage that we see right now and it will persist until we have very clear ramp down from this tariff, until somebody lowers down this this ratchet and takes an offramp from here. I mean let us see, but at least the markets know that the bond market has put a bottom on at least where the president comes in and kind of tries to save the markets. So, at least the bond yields the moment it crosses 4.4, 4.5, I think that becomes a worry sign. So, at least there is some comfort there. But yes, in terms of US market, I still believe that US is actually the place to be. People are talking about money moving to Europe that is a dead end, Europe is not going to perform, you have got to decide where your money is going to be. Europe has not performed for the past 15 years. So, my firm belief is money can go to China, money can go to India, but it certainly is not going to go to Europe. So, eventually US is going to prevail, on the margins I am sure India will do well and so will China. So, I mean India is likely to be a beneficiary although on the margins of the risk off manufacturing coming out of China. So, there will be some benefit, it will not be substantial, but it will be there. Aside of that, yes, India is on domestic engine, domestic economy is doing good, I mean it is not too bad relatively to the world. So, I am quite positive India will do well along with China. But sectorally help us understand that where is the FIIs interest coming in when it comes to the Indian markets because yes, we know that their major exposure has been in the financial space and that space is definitely rocking, but other than that help us understand which sectors are looking good at this point in time and where are the FIIs trying to look at this point in time. Anurag Singh: So, there is a long-term view on your question, there is a short-term view. Whatever the flow is coming to India, usually the trend is if the dollar weakens, it is at 98. I mean, it was 110, believe it or not like a month and a half back. So, whenever dollar weakens, money comes to emerging market. But this time dollar is weakening for a wrong reason and my sense is Chinese are dumping and even the Japanese are dumping the dollar for the time being on the margins, so that is one reason. You do not see a huge gush of money coming to emerging market, so that is the immediate short-term reason. Long-term, the trend is that Indian market, I strongly believe you can keep counting on the margins, but I am of the school of thought that the peak of FIIs holding in India happened in 12-13 which was like 22%, now it is back at 15%, it might range, go down to 12%, eventually the trend will continue. If there is such a long-term persistent trend, there is no reason that should change overnight. But domestic flow is huge. So, something has to balance out. So, that is kind of my quick take on FIIs overall level of holdings in India. In terms of what to buy, I think we had a great party for last five years on all the kind of non-performers in the economy which is PSUs and manufacturing and what not. I think we need to come back to the core of technology, banking, and FMCG because next three years in Indian market are not going to be rocking returns, they are going to be like 5, 6, 7, 8, 9, 10% returns in the market overall and so this is the time where you absorb the returns you have made for the past five years and build on that. So, in that sense you always go back to those stable sectors which drive the economy which is FMCG, banking, technology, and a bit of healthcare of course which is a rising sector and it is not a time to get into any of these fancy sectors which people tried for the last three-four years.
