Lecture Notes: Monthly Market Outlook Presentation

Global Economic Overview

• PMI Weakness: Global PMI remains weak, worsened by ongoing tariff wars.
• Global Pessimism: High uncertainty is affecting global markets.
• Emerging and Developed Markets: Emerging markets stable, developed markets see slight advancement, but risks due to tariffs.
• Central Bank Actions: Central banks are injecting liquidity and maintaining low interest rates.

European and Chinese Markets

• European Markets: Near all-time highs due to EU fiscal policies.
• China: Preparing fiscal measures to counteract US tariffs; potential currency depreciation expected.

US Economic Challenges

• Federal Deficit: High single-digit deficit, $36 trillion debt (123% of GDP), impacting fiscal health.
• Tariff Strategies: President Trump's tariffs aim to reduce deficits and create sovereign wealth fund, though uncertain outcomes.
• Economic Uncertainty: Tariff policies causing market volatility.

Federal Reserve Actions

• Interest Rates and Inflation: Fed cautiously managing rate cuts and liquidity amidst inflation concerns.
• Monetary Policy Influence: Fed's role critical alongside geopolitical leaders.

Impact of Tariffs

• Definition and Effects: Tariffs based on trade surplus, causing recessionary pressures historically.
• Global Economic Impact: Tariffs raising costs in the US, impacting consumption and GDP growth.

India's Economic Position

• Growth Impact: Tariffs expected to reduce FI26 growth estimates.
• 10-Year Growth: Despite challenges, India doubled its GDP in the past decade.

Market and Sector Insights

• Market Valuation: Correction in market cap to GDP ratio; valuations still fair.
• Corporate Profits: Significant growth in corporate profits expected.
• Foreign Investment: FBI selling pressure balanced by domestic investments.
• Equity Market Opportunities: Large caps preferred due to valuation, small/midcaps slightly overvalued.

Investment Strategies

• Consumer Discretionary: Attractive due to tax rebates and other economic factors.
• Equity Fund Performance: Consistently outperforming benchmarks.

Debt and Gold Markets

• US and India Inflation: Tariffs impacting US inflation, India's inflation under control.
• Debt Investment: Opportunities in long-term maturity investments.
• Gold and Silver: Continued bullish outlook for gold, potential in silver.

Presentation Conclusion

• Feedback and Engagement: Encouragement for feedback on the presentation and engagement events.
• Questions and Interaction: Open floor for questions, ongoing performance evaluation of funds.