Sunday, 7 January 2024

Financial Markets @ January 2024

 

Dear Patrons,

 

Season Greetings!

 

We are getting ready to step into 2024 with markets at record highs in India. There are expectations that the Indian economy is poised to be one of the fastest-growing economies in the world. However, globally, an economic slowdown is expected in 2024. Politics may also create turbulence and uncertainty, as there are 40 upcoming national elections representing 41% of the global population in 2024 alone. Russia, India, the European Union and, the United States, will hold elections that will likely re-shape the path of global affairs in the second half of the decade. Security and defence spending, both in the United States and globally, are likely to increase in almost any political outcome, given the disappearance of the “peace dividend” in Europe, the Middle East, and the Far East. A major surprise for 2024 would be an end to regional conflicts, namely the war between Russia-Ukraine and Israel-Hamas. This could provide a more favourable economic backdrop than is currently discounted in markets.

However, market volatility in the short term can create attractive investment opportunities that investors should be prepared to take advantage of. Investing in the appropriate diversified mix of stocks, bonds, and alternative investments, will be particularly important in navigating these difficult conditions.

Happy Investing

(Inputs from Franklin Templeton)

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