"Decoupling between Equities & Economy." with Aditya Narain & Harshad Patwardhan

What will you learn in this webinar?

Signs of renewed activity are surfacing across the country as states gradually reopen economies and some businesses call a portion of their laid-off staffers back to work but is it still helping the economy move forward even though equity markets continue to rise? 

How far can this continue?

This interactive session was conducted between Harshad Patwardhan, CIO Equities - Edelweiss AMC, Aditya Narain, Head of Research, Institutional Equities, Edelweiss Securities Ltd. , moderated by Radhika Gupta, MD & CEO. This session will provide key perspectives on the above-mentioned questions for investors.

Key learnings from this webinar

At the onset of Covid-19, markets witnessed a sharp selloff and heightened volatility. The negative sentiment in March 2020 was further exacerbated by high selling pressure from Foreign Portfolio Investors (FPIs). However, markets have since then recouped most of their losses, even while the prospects for the Indian economy look bleak. Is there a decoupling happening between equities and the economy?

• The market is supposed to reflect the economy. However, currently, the market and the economy are moving in the opposite direction
• Economic cycles tend to be longer and take time to materialize – markets, on the other hand, tend to react very sharply in the short term while looking beyond the current cycle
• Investors wonder whether the market is right or the economy – the bottom-line is that they need to strike a balance and perhaps meet mid-way
• Disconnects are not abnormal. In fact, they need to be treated as an opportunity
• Investors need to evaluate the strength of the rally
• While choosing stocks, investors should look at price to book value and evaluate relative rather than absolute performance
• Select businesses that are anti-fragile rather than fragile – these are the ones that will be able to weather the storm better