2020 GLOBAL STOCKS MELTDOWN ~ AN OPPORTUNITY ?

Cash     Courage    Conviction

Correction was long overdue in Global Stock Markets .In previous editions we’ve spelled out the disconnect between rising Stock Indices and declining Economies on the strength of Liquidity Flows .COVID-19 introduced the correction globally in Stocks across Continents right from the start of 2020 with Capitulation seen last week before a stunning pullback.Yet Global Indices are in the red in 2020 with South America, Europe, Japan and Thailand plunging the most. Quite interestingly China, where the Corona Virus COVID-19 originated, has seen its Indices barely drop because it closed its markets early in 2020 and restricted short selling on re-opening on February 3,2020. In fact SZSE is in the green!

Here’s how Global Indices fared in 2020 till date

In our view markets will continue to still seek lower levels in the coming months with intermittent pullbacks as we saw on Friday. It is difficult to call the bottom as it’s difficult to call the duration, spread  and intensity of COVID-19.But it’s easy to call ,based on historic evidence, that after this crisis passes and after any US & Global Recession the bounce back in Equities will be significant in the years ahead. These declines are introducing some sanity back on Valuations on the bourses and give some great opportunities in value buying for the long term. India also is in a relatively sweeter spot on the recent Saudi Arabia’s Oil Shock plunging Oil prices lower and which we expect to stay lower all of 2020.We lucidly explained this in the previous edition

Major Spoilers for any recovery later in 2020 could be that the COVID-19 crisis prolongs late into 2020 and hopefully not into 2021 and Geo Political Conflicts will intensify across global hotspots in the Middle East and Asia as economic stress pushes Nations to the wall.

We would strongly recommend an Asset Allocation exercise in sync with your Risk Profile to :

• Those with Direct Equity in their Portfolios to review to take a decision if warranted on repositioning in stronger selections that are now available at much lower prices even if it involves taking a loss on some existing selections and even consider infusing more into Equity gradually
• Those with no exposure in Direct Equity ,it’s a great time to consider initiating an exposure

Cash, Courage, Conviction all three are being called for here. In 2020 it calls for Vision and History supports here. On Hindsight with a 20/20 Vision in 2022 and 2023  you should be smiling in your Direct Equity Portfolio

If you’re on our Fundamental Wavelength here, do connect to take advantage

Disclosure & Disclaimer

Jeena Scriptech Alpha Advisors Pvt Ltd (JSAAPL) is a SEBI Registered Entity offering Fundamental Direct Equity Research Analysis, Equity Portfolio Advisory, Training & Mentoring Services in Capital Markets

This Report is under our free access SCRIP STANDPOINT Module.It is for the personal information of the recipient/reader. We are not soliciting any action based upon it. This report is not to be construed as an offer to sell or the solicitation of an offer to buy any security in any jurisdiction. It is our Viewpoint for general information purposes only. It does not take into account the particular investment objectives, financial situations, or needs of individuals & other entities .We have reviewed the report, and in so far as it includes current or historical information, it is believed to be reliable though its accuracy or completeness cannot be guaranteed. Neither JSAAPL, nor any person connected with it, accepts any liability arising from the use of this document. The recipients of this material should rely on their own investigations and take their own professional advice. Opinions expressed are our current opinions as of the date appearing on this material only. No part of this material may be duplicated in any form and/or redistributed without JSAAPL’s prior written consent.

In case you require any clarification or have any concern, kindly write to us at: [email protected]