Weekly wrap - Is Gold losing its shine ?

Stock Market, ended in red, on week ending 19th Feb 2021 ( Friday) . Nifty closed at 15004 against 15307 as on 15th Feb 2021 ( Monday). The consolidation of trades were clearly visible in the trades of previous week only, which further continued this week also. After the tremendous bull rally post budget, investors are slowly showing concerns over some of the key macro questions, like -

What will be the impact of Rising Crude Oil rates ?
Are we expecting a higher GDP with higher inflation ?
Are the valuations in line with the corporate earnings ?
Are we going to face another wave of COVID threat ?


Above questions are quite valid from an analyst point of view, as the questions are directly related to the price of one very important investment product also - Gold ! As we know that Gold is always seen as a special hedge against inflation. So, if experts are looking at a rising inflation ahead, why is Gold falling ?


As you know, Gold is an investment product which shines more during the crisis. Hence, Gold is currently trading almost Rs 10000 below its peak rate, due to positive uptick in the economy and major recovery in corporate earnings after COVID - crisis. However, fundamentally it is a good buy from this point - around Rs 46000 level. Experts see a short term rise in Gold due to expected inflation rise in future. Moreover, the new series of lock down in few Indian locations and abroad, makes the case for gold buying, further strong.


In the week ahead, keep a close eye on following :


- Pressure on Corporate earnings and high PE of frontline stocks : Negative for Indian Equity Market

- Rising Bond Yield in US : Negative for Indian Equity Market

- Rising Oil Prices : Bad for macro economy

- Rise in Midcap Corporate earnings : Good for Midcap Stocks


Please find the MF category wise performance sheet for the week ending 19th Feb 2021 ( Friday) ; you should see the consistency in top chart - PSU funds and Energy based thematic funds :


Important Note : This is the perfect time for investing in Dynamic Asset Allocation Funds. Do ask us for the Scheme chart under this category. Call us freely at : 9307218766 to order your trades

Disclaimer : Mutual Fund investments are subject to market risks, read all scheme related documents carefully. The NAVs of the schemes may go up or down depending upon the factors and forces affecting the securities market including the fluctuations in the interest rates. The past performance of the mutual funds is not necessarily indicative of future performance of the schemes. The Mutual Fund is not guaranteeing or assuring any dividend under any of the schemes and the same is subject to the availability and adequacy of distributable surplus. Investors are requested to review the prospectus carefully and obtain expert professional advice with regard to specific legal, tax and financial implications of the investment/participation in the scheme.






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