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  Dear Reader, Foreign Portfolio Inflows Propel Indian Markets The Indian markets experienced a surge in foreign portfolio funds, propelling the Nifty to conquer Mount 19k and even target Mount 20k. Inflows into India Equity Funds reached their highest level since Q2 2015, while India Bond Funds also saw a record weekly inflow until July 12. De-Sinofication and Asian Stock Rush One major factor behind the inflows is de-Sinofication, as Western investors turn away from China and seek opportunities in other Asian markets. This shift in flows has been driven by disappointment over China's recovery, leading foreign investors to seek refuge in Asian stocks. US Dollar's Impact on Emerging Markets The weakening US dollar has been bullish for emerging markets, including India. Renowned strategist Stephen Jen predicts further USD depreciation, signaling potential growth for emerging markets. However, some experts caution that the current environment differs significantly fro...

  Dear Reader, Welcome to this week's edition. In our previous issue, we discussed how bond markets reacted to hawkish Fed minutes and a strong private jobs report, causing bond yields to rise. However, the sentiment shifted later in the week as the US non-farm payrolls report fell below expectations. This brought back smiles to investors' faces, and their optimism continued into this week. Global food inflation remained largely under control in June, as indicated by the decline in the FAO food price index. However, domestic food inflation saw an increase, with food prices rising by 2.5% on a month-on-month basis. Notably, pulses and vegetable prices experienced sharp increases. While the monsoon tracker highlighted an improvement in the uneven rainfall situation, the risk to agriculture still persists. In domestic inflation data, the positive aspect was a decline in core inflation. An analyst, pointed out that while this was good news for inflation-watchers, the US infla...

Welcome to our weekly newsletter, where we bring you the latest insights and trends from the world of finance. This week, our focus is on the upcoming quarterly earnings season, with particular emphasis on the banking sector. It appears that listed firms are poised to deliver another impressive set of numbers, although the pace of growth may vary across sectors. Amidst the noise and excitement, we have identified two key data points that can provide valuable insights for investors. Data Point 1:   Loan Interest Rates The share of loans with interest rates of 9 percent and above has risen to 56.1 percent as of January-March FY23, up from 39 percent in the previous quarter (FY22 Q4). This data point highlights the scope for bank earnings this season. Banks generate revenue by charging interest on loans they provide and paying interest on deposits they receive. The difference between the two is their earnings. While the potential for further lending rate increases is limited, as muc...