Indian and Chinese Market To Explode ?

Today’s Market Update

The market saw a small bounce, which seems to be driven by a few potential triggers. One factor is the growing possibility that the Supreme Court may strike down Trump's tariffs.

Even Trump himself appears frustrated, as suggested by his tweets expressing disbelief and asserting a president's right to take such actions, possibly preparing the ground for an upcoming final decision.

Another potential catalyst is the rumor that the Federal Open Market Committee (FOMC) is likely to cut rates. A third factor is the discussion surrounding a potential stimulus, such as the US distributing $2,000 per person.

• Looking at the Nifty, the market built on a very nice support established in the previous session, but ended the day up only 0.32%, having given up almost 100 points of the day's gains after reaching 25,653.

• Other indices showed similar moderate gains: Nifty Junior was up 0.38%, Mid Caps rose 0.45%, and Nifty Bank gained 0.1%.

• Small Caps, however, were completely flat, up 0%, showing no movement despite the rest of the market's slight uptick.

• In commodities, gold is up 1.98% and has hugged its moving average very nicely.

• Silver also marked a strong gain of 3.28%. This activity could signal the start of another major upward leg for the precious metals.

Other Market Triggers

• In stock movements, IT stocks saw good gains, as did Reliance, Bharti Airtel, L&T, Asian Paints, and Bajaj Finance.

• Losses were seen in stocks like Tata Motors, Power India, and SBI, with LIC also losing some ground.

• Other stocks that lost ground included Lodha, Varun Beverages, Bajaj HFL, Adani Green, Adani Power, BPCL, and United Spirits.

• Interestingly, several PSU and public sector enterprise stocks are coming back, such as HAL, which is one of them.

• Torrent Pharma was doing well in the pharma space, along with Hindustan Zinc, Chola Finance, and Enrin.

• National Aluminium was a major mover of the day, running up 9.64% due to a good dividend declaration and strong results.

U.S. Market Update

• The US market remains very strong despite the ongoing calls for an AI correction. With renewed talk of stimulus and rate cuts, the US market is unlikely to crash down, even though the last session was very flat, with most indices showing less than 0.2% movement either way.

• Top gainers in the US included Starbucks at +4%, T-Mobile, General Motors, United Parcel, and Intel Corporation.

What to watch next ?

• Calling the top of the gold bull rally could be a mistake. The recent pause was only a brief stop on the way, which now appears complete. Gold in India (per gram, rupee terms) is now at 12,322.

• The market remains tentative; the trend has not definitively turned, as we haven't even closed above a two-day high, which is considered a minimum requirement. The Nifty is still in a zone where it could potentially go down, although it might also consolidate sideways.

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What To Read This Week ?

India’s Hidden Wealth: The Power of Gold in Indian Households

Silver Investment Returns: 25-Year Performance and Global Comparison

📈 Global Power Shift: India and China’s Explosive Growth Trajectory

The Next 15 Years: A Look at GDP Projections

A compelling analysis of global economic growth trends, specifically focusing on India, China, and the US, highlights a dramatic shift in economic power projected over the next 15-20 years. The data, normalized using Purchasing Power Parity (PPP), illustrates the accelerating growth of Asian giants.

• Current Estimates (PPP): The analysis starts with current estimates of approximately $18 Trillion for India, $30 Trillion for the US, and nearly $40 Trillion for China.

• The 2040 Projection: By around 2040, the growth trajectory suggests two major shifts:

  1. China's Dominance: China is projected to open up a substantial lead over both the US and India.

  2. India Surpasses the US: India is projected to overtake the US in terms of GDP (normalized by PPP) around the 2040 mark.

🌍 The Shrinking Share of the US in World GDP

The combined economic weight of India and China is already causing a measurable shift in global GDP share, a trend that is expected to accelerate dramatically.

• The US Decline: The US share of total world GDP has already fallen from approximately 22% to around 15% over the last 45 years.

• The Indo-Chinese Rise: The combined share of India and China has already reached approximately 29% of global GDP.

• Future Impact: By 2040, the combined share of India and China versus the rest of the world will become immense.

This data underscores the reality that while daily market movements often mask the bigger picture, massive structural changes are emerging in the global economy over the next decade and a half.

🎯 Identifying the Winning Stocks: Ride the Momentum

This unprecedented shift in economic power will naturally be reflected in the stock markets. Certain companies are poised to capitalize on these massive trends, leading to "unbelievable" growth. The key challenge for investors is identifying these future market leaders.

Investment Strategy Pointers:

• Fundamental Filtering: If you have proprietary fundamental or value filters that can successfully identify high-growth companies aligned with these macro trends, use them.

• The Momentum Strategy: The easiest and most effective way to identify the companies riding these mega-trends is to "Follow the Trend."

• Risk Management: Momentum investing is also practical for risk management: when you feel the trend is no longer with you (i.e., the stock stops making new highs or reverses), you can easily exit the position.

Key Learning

The current growth estimates, based on existing pace, project that India will surpass the US in terms of GDP (PPP) around 2040, confirming a long-term, structural shift of global economic power towards Asia.

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