In today’s briefing:
- Is the Santa Claus Rally a Myth or Market Reality?
- Our Best Calls in 2024: Review and Outlook for 2025
- #75 India Insight: FPI Investment Plunges 96%, Tata Semi Con Plant, HAL Tejas MK – 1A Plan
- Charted Insights: India’s Inflation Outlook for 2025; More Chances of Downside, Rather Than Upside
- Charted Insights: What Investors & Consumers Feel About 2025 Economic Outlook
- OK Super Fast Rollout in Kansai a Threat to Kansai Super and Others
Is the Santa Claus Rally a Myth or Market Reality?
- The “January Effect,” where investors repurchase stocks previously sold for tax-loss harvesting purposes at the end of December creates demand.
- The Nifty 50 has experienced the Santa Claus rally in 9 out of the past 10 years, averaging a 1.76% return during this period.
- Government shutdown risks in the US, rising treasury yields, and concerns about overvalued markets could dampen investor enthusiasm in 2024
Our Best Calls in 2024: Review and Outlook for 2025
- With a range of 34.5-68.1%, our five best calls in 2024 generated an average return of 54.1% YTD, outperforming the Hang Seng Index by 26.2pp.
- China Communications Construction (1800 HK) and Dongfang Electric (1072 HK) are expected to sustain strengths into 2025 on market value management and pick-up in new orders.
- Xinhua Winshare (811 HK), China Everbright Environment (257 HK), and SITC International (1308 HK) may hold their share price, but gains are unlikely to be as much as 2024.
#75 India Insight: FPI Investment Plunges 96%, Tata Semi Con Plant, HAL Tejas MK – 1A Plan
- Foreign investors shifted focus from equities to debt in 2024, driven by India’s inclusion in global bond indices and expectations of US interest rate cuts, despite earlier equity outflows.
- Tata’s new semiconductor facility in Assam, set to operationalize in 2025, will strengthen India’s semiconductor ecosystem.
- Hindustan Aeronautics (HNAL IN) will begin trials for Tejas Mk-1A jets in January 2025, aiming to meet IAF delivery deadlines and ensure operational readiness despite production delays.
Charted Insights: India’s Inflation Outlook for 2025; More Chances of Downside, Rather Than Upside
- Inflation spiked in late 2024 due to food price pressures but is projected to average 4.8% in FY25, with moderation expected from a strong rabi season and seasonal corrections.
- Weights of commodities experiencing inflation over 4% in the CPI basket, reduced from 79.0% in August 2022 to 41.6% in November 2024.
- Inflation is expected to moderate with a strong rabi season, record kharif production, and seasonal corrections in vegetable prices. However, risks from rising edible oil prices, and global factors persist
Charted Insights: What Investors & Consumers Feel About 2025 Economic Outlook
- Emerging markets like India, Indonesia, and Argentina exhibit strong optimism for 2025, driven by growth prospects and reforms, while developed economies, face challenges from energy shocks & slower growth
- Inflation, higher taxes, and rising interest rates remain top concerns for Indian households and businesses, but the country’s demographic advantages and ongoing reforms position it as a global growth leader.
- The coming decade belongs to emerging economies as they reap benefits of demographic dividends.
OK Super Fast Rollout in Kansai a Threat to Kansai Super and Others
- OK Super opened its first store in Kansai in November with a second already due in January and at least one more by the end of 2025
- But then it will open 10 stores a year in the region aiming to take the lead in Kansai just as it did in Tokyo/Kanto – bigger even than Aeon.
- More than 300 people queued to get into the supermarket and OK’s EDLP strategy is certain to prove a hit with customers in the region. Competitors will be hit hard.
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