Billionz Multi-Asset Weekly Newsletter
Domestic Markets Hold Firm as Global Equities Face Pressure
Global Developments:
US continued to strike Iran this week while Iran retaliated by striking US military bases in Kuwait and Bahrain. US has struck Iran for 7 straight days now. The versions of whether both sides will get back to the negotiating table differ between the two sides. For now, the tensions seem escalating. This has given rise to fresh geopolitical uncertainty after both sides had agreed to talks earlier this month. US inflation prints this week, both CPI and PPI surprised to the downside. Market is pricing in slightly more than 1 hike by the Fed by end of 2026. AI stocks came under pressure globally this week. Nasdaq100 fell 4.1% on back of sell off in core chip index which fell 10% this week, registering it’s worst weekly performance this year. Key event to focus on next week will be the ECB rate decision. ECB is expected to keep rates on hold.
Global Equity Markets:
Domestic Equities:
- Valuations remain elevated across market segments, with Midcap100 and Smallcap250 continuing to trade at a significant premium to the Nifty50.
- While earnings have largely supported current valuations so far, selective stock picking remains crucial as broad market upside may be more measured from current levels.
- For the handful of Nifty50 companies that have reported Q2 earnings so far, there have been minor positive surprises on both Earnings and Sales front.
- FPIs have invested net USD 1.2bn in domestic equities in July so far.
- FIIs remained net sellers this week, recording net outflows of ₹9,120 crore, while DIIs provided support with net inflows of ₹9,809 crore.
- The week’s strongest performers were eClerx Services (+22.1%), Kalyan Jewellers (+20.6%), and Prime Focus (+12.8%), while Patanjali Foods (-18.4%), ICICI Lombard (-11.7%), and Go Digit (-9.7%) recorded the steepest declines.
Below are the graphical representations for how key benchmark indices performed this week& how sectoral indices performed this week:
Fixed Income:
Global Rates:
- US and Japanese 10-year bond yields declined by 8 bps each during the week, while European yields were mixed, reflecting divergent expectations on inflation and central bank policy.
India Rates & Flows:
- India’s 10-year G-Sec yield rose 7 bps to 6.78%, while FPIs invested a net USD 900 million into domestic debt in July so far, with banking system liquidity remaining in a surplus of around ₹80,000 crore.
Real Estate
- Institutional interest remained strong, with M3M India planning to raise $200–250 million to fund land acquisitions and expansion.
- Fresh investments in residential real estate and renewable energy reflected continued confidence in India’s long-term growth story.
IPOs
- Cube Highways Trust InvIT will be the key primary market issue next week, aiming to raise ₹5,000 crore, backed by ₹1,250 crore of anchor commitments from leading institutional investors.
- The primary market will also see Xtranet Technologies’ mainboard IPO alongside SME issues from Metalic Technoforge and Gulf Lloyds India, keeping issuance activity healthy.
Private Equity & Venture Capital
- PE/VC funding rebounded strongly, with 13 companies raising over $643 million despite a decline in deal volumes.
- Large investments in Udaan, Emergent AI, Ather Energy, and Cube Highways Trust highlighted continued investor focus on technology and infrastructure-led businesses.
Commodities:
Commodity markets were dominated by strength in the energy complex, with oil and European natural gas surging on heightened geopolitical risks. In contrast, gold and silver declined as improving risk sentiment and profit-taking weighed on precious metals.
What’s New in the World of Wealth Management:
he headline capital markets event of the week was the SBI Funds Management IPO closing on July 16 with a stunning 42x overall subscription, receiving bids worth Rs 2.98 lakh crore against an issue size of Rs 9,813 crore, making it India’s largest and most subscribed billion-dollar domestic IPO ever. QIBs subscribed at 140x, NIIs at 22.5x, and retail at 3.6x, reflecting deep institutional conviction in India’s asset management sector at a time when mutual fund AUM has crossed Rs 80 lakh crore and SIP flows continue to set monthly records. On the QIP front, Ather Energy’s Rs 1,300 crore QIP received over Rs 10,000 crore in bids, an 8x subscription from leading DIIs and FIIs, with a concurrent Rs 1,200 crore preferential issue taking the total fundraise to Rs 2,500 crore, signalling strong institutional conviction in India’s EV two-wheeler segment.MakeMyTrip, the Nasdaq-listed travel major, used SEBI’s confidential pre-filing route to submit its DRHP for a secondary domestic listing, joining a growing pipeline of global-listed Indian companies seeking dual listing access to domestic capital pools.
Our Views: What we Like?
Equities: Nifty50 continues to consolidate in tight ranges. We seem to be locked in 23600-24600 range for now. It is therefore time for active sector allocation and stock selection. We are overweight IT, FinNifty, REITs, Chemicals in our model portfolio.
Fixed Income: Bonds and Rates sold off as energy prices spiked this week. Domestic CPI print too came in higher than expected at 4.38%. We expect the yield on the 10y benchmark to trade a 6.70-6.95% range over the next few weeks.
Commodities: Energy prices spiked this week and price action is likely to be headline driven. Gold and Silver seem to be in value territory where one can consider adding positions from a long term horizon perspective.
FX: Dollar continues to be extremely range bound against majors. We expect USDINR to trade a 94.80-97 range over the next few weeks with risk to the upside.
