Synopsis
One trick pony and the blinkered bull
The June edition of Market Musings argues that the ground beneath global and Indian equities has quietly shifted.
A new and more hawkish Federal Reserve under Kevin Warsh signals that the "Fed Put" has expired, leaving the narrow, AI-driven rally increasingly exposed.
We weigh the genuine positives for India — softer oil, measured RBI action and resilient banks — against the risks of stretched small and midcap valuations and persistent foreign outflows.
Our conclusion returns to first principles: as narrative outruns fundamentals, earnings resilience, visibility and valuation discipline will separate the durable from the fragile.
Read the full note for our analysis of the Fed transition, US and Indian market valuations, and what it means for portfolios.