According to CNBC TV18, Matt Orton, Chief Market Strategist at Raymond James Investment, expects higher long-term yields to keep pressure on global markets in the near term, even as the Nasdaq continues to hold up. Orton notes that rates are impacting US markets beneath the surface, creating a tech-led rally with stocks sitting close to all-time highs. He explains that while rates are taking a bite out of the average stock in the US, the technology sector remains relatively less sensitive due to massive capital spending from hyperscalers. As reported by CNBC TV18, Orton says the US technology rally remains supported by heavy capital spending from hyperscalers, making the sector relatively less sensitive to rates for now.
On India, Orton believes selectivity is becoming increasingly important as foreign outflows, a weaker rupee and higher rates weigh on the broader market. As reported by CNBC TV18, he sees opportunities in stocks such as Mahindra & Mahindra, Eicher Motors, Nykaa and Adani Ports and SEZ, but emphasizes that investors should deploy money gradually. Orton notes that Indian markets are suffering from the same average-stock challenges as the US market, with heavyweights moving down and weighing down the overall index. When speaking with CNBC TV18, Orton highlighted that gradually deploying is the key, but there are opportunities in select stocks, particularly noting that M&M's recent sell-off presents a great buying opportunity.
Regarding Indian banking, Orton tells CNBC TV18 that ICICI Bank has been bouncing over the past couple of trading sessions, which is encouraging to see. He views HDFC Bank as a show-me story due to previous management issues and challenges that need to be worked through. Orton suggests that investors should wait until the company delivers stable ROE and improves guidance to demonstrate they are still a quality bank to the market.
According to CNBC TV18, Orton identifies Mahindra & Mahindra as a great buying opportunity following recent sell-offs. In the auto space, he highlights Eicher Motors as a fantastic growth story both in India and globally. For consumer stocks, he recommends Nykaa, which has flashed up with strong Q2 performance showing continued strength in their core beauty business and growing traction for House of Nykaa. Additionally, he mentions Adani Ports and Economic Zone as names that have weathered geopolitical uncertainty well. Orton notes that Nykaa's core beauty business continues to fire on all cylinders and House of Nykaa is getting more traction in the market, which is great to see.
As reported by CNBC TV18, Orton emphasizes that gradually deploying is the key for investors in current market conditions. He notes that while there are opportunities in select stocks, the overall market faces challenges from foreign outflows and macro headwinds. Orton suggests that investors should focus on quality stocks being rewarded by the market and avoid broad-based exposure until there's more macro stability in the global marketplace. His message to investors is that selectivity really pays off and being in quality that's being rewarded by the market is a good place to hide until there's more macro stability in the overall global marketplace.
