Do it yourself

The year 2025 is likely to be remembered not as a moment of rupture, but as a period when several long-term global trends became impossible to ignore. Political realignments, economic fragmentation, and rapid technological change have collectively weakened the assumptions that shaped the global order over the past three decades. Rather than a sudden “reset,” the world appears to be undergoing a gradual but meaningful reconfiguration. Existing systems continue to function, yet their underlying logic is shifting. Governments, markets, and institutions are adjusting to this reality, though not always in a coordinated or predictable manner. From integration to strategic competition For much of the post–Cold War period, economic integration was seen as a stabilizing force. Trade, capital flows, and technology exchange were expected to align national interests and reduce conflict. That assumption is now being tested. Major economies are increasingly treating economic capabilities as ...

  Across global banks, asset managers, and research institutions, the consensus view for 2026 is of a sub-trend but resilient global economy transitioning into a post-inflation, late-cycle phase. Growth is expected to remain positive but uneven, led by the U.S. and parts of Asia, while Europe lags amid structural and fiscal constraints. Inflation is broadly forecast to moderate toward central-bank targets, giving policymakers room for gradual and cautious rate cuts, though a return to the ultra-low-rate era is not expected. Financial markets are seen shifting from liquidity-driven gains to earnings- and fundamentals-based performance, with lower average returns, higher dispersion across assets, and sustained volatility. Structural forces — geopolitical fragmentation, elevated debt, demographic pressures, and the transition to a more multipolar global order — dominate cyclical drivers, while technology and AI-led productivity gains remain the key upside risk. Overall, instit...

As I mentioned yesterday ( see here ) the pain being felt presently by the non-institutional investors is disproportionately high. For the investors and traders who have spent a short period of time in the market, mostly those who started investing in post Covid period, the pain may be actual, while for those who have been investing for a long time, the pain might only be notional due to perception of relative underperformance or loss of opportunity cost. Over exposure to small cap stocks While large caps account for ~60–63% of total and free-float market capitalization, retail participation in this segment has been relatively muted. Institutional investors—both domestic and foreign—continue to dominate ownership and trading activity in large caps. As a result, price discovery here has been more orderly, liquidity deeper, and drawdowns relatively contained. In contrast, non-institutional investors (retail investors, HNIs, family offices, and smaller proprietary books) have had di...

The benchmark Nifty50 has faced acute selling pressure around the 26000 level in the past two months. It has made several unsuccessful attempts to sustainably topple over this barrier. Nifty Midcap100 (benchmark for midcap stocks) has also shown a similar trend in the 60000-60500 range. Nifty Smallcap 100 (benchmark for smallcap stocks) has declined for the past two months. It is pertinent to note that in Indian context, a large cap company is defined as a company that falls within the top 100 companies in the country in terms of total market capitalization. At present, the companies with a total market capitalization in excess of appx Rs1060bn (~USD1.2bn) would qualify to be large cap companies. The companies with a market capitalization rank from 101 to 250 are termed as midcap companies. Presently, the companies with a total market capitalization between 343bn and Rs1060bn (US$375mn to US$1.2bn) are classified as midcap companies. All other companies are classified as small cap co...

Over the past few weeks, Indian financial markets have begun to show unmistakable signs of stress. While the benchmark indices such as the Nifty and Sensex have largely managed to hold their ground, the underlying market tone tells a very different story. A significant number of small- and mid-cap stocks have undergone sharp price corrections, exposing the fragility beneath what still appears, on the surface, to be a resilient market. This divergence between benchmark indices and broader market performance is often an early signal of rising investor discomfort. And this time, the discomfort has morphed into something closer to panic. The anatomy of the current panic The most pronounced damage has been in momentum-driven stocks, many of which were heavily owned by non-institutional investors. As liquidity dried up, these stocks witnessed not just steep price declines but also an absence of buyers, exacerbating the fall. This is a familiar pattern: assets that rise rapidly on optimism an...