Macro headwinds cloud outlook for Indian equities in November
Investors face a choice between positive historical seasonality and risks like high crude oil prices and rising global bond yields.
According to the Economic Times, investors entering November must balance historically positive market trends against challenges including a weak rupee, rising global bond yields, and high crude oil prices.
Historically, November has been a strong month for Indian equities. The Sensex has finished higher in seven of the last 10 years, while the Nifty 50 has gained in six of those years.
Kranthi Bathini, equity strategist at WealthMills Securities, said that the extension of festive activity into November could support market sentiment. Bathini noted that this could encourage corporate earnings and renewed foreign buying.
Foreign portfolio investors have become net buyers over the last two weeks, purchasing almost $2 billion in Indian equities. Experts suggested global investors are seeking growth opportunities and cheaper valuations.
However, crude oil remains a significant risk as prices trade near $115 per barrel. Experts said a de-escalation in West Asia could trigger a relief rally and support equities.
Aditya Agarwala, co-founder and CIO of InvestValue Capital, advised investors to favour companies with strong domestic earnings visibility and pricing power, such as private financials and select consumption stocks.