If the world right now was a Mission Impossible movie, global stock markets would be the helpless victims, free falling from a helicopter thousands of feet above the ground. Caught in the crossfire of policies, regulation and geopolitics, they would await the invincible and elusive Ethan Hunt to show up and save some (and lose some). Unfortunately for the market, reality doesn’t offer that luxury. There’s neither a knight in shining armour, nor a sneaky well-trained spy who survives even after falling off helicopters, mountains and sky-high towers. But the villains are aplenty.
One of the biggest victims here — Dalal Street — has been languishing since the Union Budget on July 5. Benchmark indices Nifty and Sensex have slipped by 9% and 8% respectively since, and BSE 500 companies have lost nearly Rs.15 trillion in market cap. Heavy foreign portfolio investor (FPI) outflow and dismal earnings growth are just the tip of the iceberg. The market is expected to remain under pressure from the economic slowdown and sluggish pick-up in private capex.
But at least some are getting a kick out of the situation, trying to find humour in distress. The government was celebrating its successful campaign to save tigers and value investor, Vijay Kedia, didn’t miss the opportunity to congratulate and diss them. The market veteran quipped that while the number of tigers has increased since last count, the number of ‘bulls’ has fallen by over 20 million, signing off with #SaveTheBull that left his Twitter followers in splits! Ace investor Samir Arora, too, joked about how large-caps have turned into mid- and small-caps, confounding investors that their mutual funds are focusing more on the latter. While they try to mask concern with witty remarks, there is no denying that the bear’s grip is tightening.
There’s only one question on each investor’s mind: Where should I park my money when nothing looks right, and of whatever is left? Some analysts say the answer lies in dividend-paying stocks with sound fundamentals and reasona