Not so oily anymore!
Tumbling commodities, recession fears and some of the best reads from the week...
👊🏼Commodities getting whacked
💲Dollar Index (DXY) above 107
👋🏼Bye-Bye Mr Boris
Markets ended the week in green with NIFTY 🆙 3.0% during the week. SMIDs are buzzing in trade with PSU Bank & FMCG being the top sectoral leaders this week
Banks making a comeback (business updates have been strong) with ICICIBC gaining 7.4% during the week. Interest rate hikes, corporate credit growth picking up and a rise in pvt capex cycle aiding the run🤑
Earnings season starts with TCS reporting their lowest margins in 4 years (23.1%) reflecting the impact of salary hikes and elevated talent churn👎🏽
Commodities tumbling + sales rising resulting in strong moves by Auto players. M&M hitting all-time highs after news of British International Investment (BII) investing 1,925 cr in their EV biz⚡
Oil falls below $100 from highs of $115 at the start of the week on the back of recession fears, however, be watchful for global supply issues creeping out towards the second half. Germany is already crying out loud 😭 with all-time high electricity prices rocking the country.
Around the world in 3 mins
Boris Johnson bids adieu to 10 Downing Street after his close allies abandoned him in a wake of a series of scandals that has rocked the UK gov. Cost of living continues to rock UK households with inflation touching a 9-year high in May. But hey! the holiday season is roaring. Top airlines in the UK had to cut back on flights to minimize chaos in the airports as passengers were ready to take off this holiday season after 2 years
Oh, and talking of inflation - commodities have been whacked this week again with Cotton and Crude taking pole position. Bloomberg Commodity Index is down 16% since hitting 8-year highs in June. Well, the fun part is that it’s a double-edged sword
Commodities down —→ Inflation cools off 🌬️
Commodities down —→ Global recession fears😓
Now, as investors, we have to wait and watch which camp to side with, however, we recommend prudent asset allocation in such times.
Red dragon awakens with a slew of economic measures to accelerate growth. China’s Ministry of Finance is considering allowing local governments to sell 1.5 trillion yuan ($220 billion) special bonds in 2H. Stimulus aimed for infrastructure, maybe a relief to metal names. Also, there is news of auto support in the form of further tax exemption ($30 billion). Positive for Tata Motors (a key market for JLR)
This week in Numbers
1.15 billion
Hours viewed for Stranger Things Season 4 in the first 28 days (most-viewed English Netflix TV show ever)
3.4%
Inflation in Switzerland. Looks okay right? Well, it’s the highest in 29 years
$424 billion
Amount Africa needs this year to recoup from the COVID pandemic according to African Development Bank
Take a Kachow! break
(What we read, heard, and saw this week)
What is going on at Vauld, anyway? read more
Why War Fails read more
The Recession Vibe read more
Breaking Down Wimbledon's $350 Million Business read more
10 Ways to Solve the National Debt Crisis read more (funniest take 😂😂)
Principles of Product Led Growth listen more