Is This The End Of The Market Fall?

Market Update - Tuesday, 17 Mar

Today brought a relief rally to the markets, but the question remains whether the pain is truly over. The coming days will provide more clarity on that front.

There is currently pain visible across different industries and on the ground, not just within the stock markets. A recent conversation with a garment exporter revealed that all garments to GCC countries have stalled. Furthermore, air freights from India to the UK and US have more than doubled.

No fresh contracts are coming in at these current rates as everyone is adopting a wait-and-watch approach. Polyester prices have gone through the roof, and cotton is also rising significantly. This sudden business uncertainty is hitting certain pockets of industry, which is likely to cause a prolonged adjustment or consolidation going forward.

The markets saw a small bounce today of 0.74%. The most important part of this event is that the Nifty has been able to close above a two-day high.

• Looking at the broader indices, Nifty Junior was up 0.87%, mid-caps rose 1%, and small-caps gained 0.57%.

• While small-caps remain tentative, they are at least not falling. Bank Nifty gained 0.85%, also closing at a two-day high, suggesting the short-term move is beginning to go positive.

• In commodities, gold was absolutely flat at 1,578 at 0.39%, and silver was flat at 0.15%.

Other Market Triggers

• Stocks like Maruti, Mahindra, Bharti, JSW, LT, and IT stocks are performing better.

• The Nifty Next 50 also looked good, with DLF, TVS Motors, Motherson, and Tata Power doing well, alongside Zinc and Vedanta.

• In the mover of the day segment, MOIL rose 20% as sales reached their highest level in five years. Manganese ore and other commodities are likely to continue performing well. MOIL has been extremely battered over the last two months.

• NOCIL also went up 6.48% to 145 rupees following new investment.

U.S. Market Updates

• The US markets were also positive in the previous session, with indices up approximately 0.8% to 1%.

• Companies like Mondelez, Salesforce, Intuitive Surgical, and Meta platforms rose 2% to 4%. Some of these are part of the weekend investing US strategy.

• The Nasdaq 100 heat map looked strong with Meta, Amazon, Nvidia, Apple, Google, Microsoft, AVGO, ASML, MU, and AMD all doing well.

What to watch next ?

• Analysis suggests a two-day high is the first stepping stone toward building into something bigger. For those looking to take some risk, this serves as a first confirmation.

• While success is not guaranteed, prior to this point, it was not worth trying to catch the falling knife. Despite this, the medium and long term remain very negative for now.

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What To Read This Week ?

The 6 Billion Rial Lesson: Gold as the Ultimate Sovereignty Hedge

The Great Devaluation: A 28-Year Snapshot

Since 1998, the Iranian Rial has faced a relentless uphill battle. Looking at the data spanning nearly three decades (1998–2026), we see a currency in freefall. What was once priced at a few hundred thousand Rials is now staggering at 6 billion Rials per unit of gold.

This isn't just a price hike; it is the total evaporation of a currency's purchasing power.

The 36% CAGR: Outrunning the Collapse

When a country is decoupled from global systems—like Iran's exit from the SWIFT network—the local currency often bears the brunt. However, gold in local terms has delivered a 36% Compound Annual Growth Rate (CAGR) over the last 28 years. While the currency "blew up," gold acted as a stabilizer, ensuring that those who held it didn't lose their seat at the economic table.

Why Stocks Might Not Save You

In a crumbling economy, the stock market is a gamble. Stocks represent companies that rely on a functional economy, stable supply chains, and consumer spending. If the economy is broken, companies struggle. Gold, however, doesn't require a functional government or a booming GDP to hold value. It is the only asset that is "nobody else's liability."

The Sovereignty Shield

The most critical lesson here is about Geopolitical Risk. Whether it is a weak political formation, international sanctions, or an attack on a nation’s sovereignty, the local currency is usually the first casualty.

In these scenarios, gold isn't just an investment; it is a defensive shield that keeps your purchasing power intact while the world around you changes.

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