INDIA'S NEW IIP INDEX CHANGES EVERYTHING!

Market Update - Tuesday, 2 June

A very interesting new industrial index series has been launched. This update shifts the base year from 2011-12 to 2022 and introduces a complete restructuring of the items included in the industrial index. Outdated items have been removed, while modern products coming into practice, such as…..

The Nifty started the session on a very poor note, dropping down to 23229, but it managed to end reasonably all right at 23483, marking a 0.43% gain for the day.

• Other indices also jumped up, with small caps rising half a percent, Nifty Next 50 gaining almost a quarter percent, mid caps increasing by 0.18%, and Nifty Bank closing up 0.13%.

• Gold has also jumped up today, recording a 1.33% increase to reach a weight of 15,955 per gram. Gold is currently consolidating rather than dropping off, and whenever the next move starts, it could be a very gigantic move, making it perhaps a good time to gradually keep buying gold.

• Meanwhile, crude oil came off by 1.42% after a sharp spike over the weekend. The jury is still out on how and when this war will come to an end, as there is currently no agreement on the table, and both sides will continue working towards it according to the current narrative.

Other Market Triggers

• IT stocks, which were a dark horse, have suddenly come up very strongly over the last two to three sessions, with TCS, Infosys, and HCL Tech all doing really well.

• The rest of the market remained reasonably stagnant for the day. Adani stocks recovered a bit, and there were also some gains in DLF, MotherSon, LTM, United Spirits, and VBL, among others.

• In the mover of the day segment, Wockhardt experienced significant movement. After running up massively from 1600 levels to 2400 levels in just five sessions, the stock has come off 9% today amidst profit booking.

• NIIT is another stock that has been running up, moving from 68 to almost 92 over two sessions, which is likely a pre-earnings sort of move.

U.S. Market Updates

• The previous session of the US markets was very strong, featuring Arm Holdings up 15%, Datadog up 12%, and Zscaler up 11%.

• Cadence and Thomson Reuters were also up, gaining 10% and 8% respectively. The NASDAQ rose 0.6%, while the S&P and Dow remained flat, and the Russell was down 0.5%.

• Over just the last one month, the NASDAQ is up 10% and the S&P is up 5%. Looking at the last 12 months, the NASDAQ is up 40% and the S&P is up 27%, representing huge returns from the US markets.

• Within the NASDAQ 100 heat map, Nvidia, MU, and many other stocks did really well, while Amazon, Tesla, Meta, Google, AMD, and Apple, along with Qualcomm and Intel, took a back seat and experienced some profit booking.

What to watch next ?

• An encouraging tweet of the day came from Jensen Huang, the CEO of Nvidia, who stated that all fears regarding AI cutting software engineering jobs are complete nonsense.

• This perspective is exactly what is leading to a revival in the Indian IT software space. According to him, more and more engineers will be required, and hiring is rising, which directly contradicts the earlier narrative that companies were laying off workers and software jobs would be extremely difficult to get.

• Given that he is the goat of the AI space, if he says it is complete nonsense, it is best to believe that it is indeed complete nonsense.

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Strategy Of The Day

What To Read This Week ?

Started at the Worst Time? This SIP Truth Will Shock You!

The Ultimate Investor’s Dilemma: Timing vs. Time

We’ve all been there. You are about to start a Systematic Investment Plan (SIP), but a voice in your head whispers: "What if the market crashes tomorrow? Maybe I should wait for the bottom." It turns out that trying to time the market is one of the biggest wastes of mental energy in personal finance. A fascinating study jointly presented by Moneycontrol and WhiteOak Capital completely busts the myth of the "perfect entry point." They analyzed data across different time horizons—30, 25, 20, 15, 10, and 6 years—taking various market tops and bottoms as starting points.

The results? The final impact on your long-term wealth is practically non-existent. Let’s look at the numbers.

The Tale of Two Extremes: Real Data Visualized

To see this in action, let’s look at two of the most nerve-wracking periods in Indian stock market history: the 1996 mid-cap crash and the infamous 2008 Global Financial Crisis.

Here is what happened to investors who started their SIPs at the absolute worst time (the peak) versus the absolute best time (the bottom):

💡 Why did the 2008 "top" investor win slightly? Because by starting early, they bought more units throughout the entire 60% crash, capitalizing heavily on rupee-cost averaging while the "bottom" investor was busy sitting on cash and missing out on early installments.

The Magic Behind the Math

When you look at the 2008 crisis, a 60% drop feels catastrophic. An investor entering at the absolute peak in January 2008 probably felt like they made the worst financial decision of their life.

However, fast forward 18 years to today, and the difference between the person who timed it perfectly and the person who got it horribly wrong is completely negligible. Over the long run, regular SIP installments smooth out market volatility. The compounding machine doesn't care about your starting line; it only cares about how long you stay in the race.

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Meme Of The Day