Saturday, March 15, 2025

US Bond yield surge impacts capital flows to emerging markets, including India

Date:

Share post:

spot_img

Shillong, August 22: The surge in US bond yields is exerting its influence on capital flows to emerging markets, notably India, according to V. K. Vijayakumar, Chief Investment Strategist at Geojit Financial Services. The current equity market landscape is shaped by two key factors.

As per IANS, firstly, the resilient state of the US economy is providing a foundation for global growth and equity markets on a global scale—a favorable development. However, the notable increase in US bond yields, with the 10-year yield reaching 4.34 percent (its highest level since 2007), is having adverse effects on capital movements to emerging markets, such as India.

The trajectory of Foreign Institutional Investor (FII) inflows is closely tied to the movement of US bond yields. The situation could potentially improve if US bond yields experience a decline, but this will be contingent on shifts in US inflation trends and the monetary stance adopted by the Federal Reserve.

Given these intricate macro trends, investors are advised to exercise patience and wait for clarity before making investment decisions. Meanwhile, those with a long-term perspective might consider accumulating high-quality growth stocks. While large-cap banks appear to be fairly valued, the outlook for major players in the capital goods sector appears promising.

As of Tuesday morning, the BSE Sensex has risen by 54 points, reaching 65,270 points. Notably, NTPC and Bajaj Finance have experienced gains exceeding 1 percent.

spot_img

Related articles

RBI wins global Digital Transformation Award 2025

Mumbai, March 15: The Reserve Bank of India has won the Digital Transformation Award 2025, instituted by Central...

Owaisi should read history so he can come to senses: Shiv Sena leader Manisha Kayande

New Delhi, March 15: Shiv Sena leader Manisha Kayande on Saturday strongly criticised AIMIM chief Asaduddin Owaisi for...

Stocks remain top investment choice for next-gen wealthy Indians: Report

New Delhi, March 15: Stocks are the most preferred investment option among India’s next-generation high-net-worth individuals (HNWIs), a...

Neetu Kapoor shares ‘precious’ first picture taken with ‘gorgeous’ Alia Bhatt

Mumbai, March 15: On her daughter-in-law’s 32nd birthday on Saturday, veteran actress Neetu Kapoor shared the first “precious”...