Can Nasdaq stocks maintain their momentum or is a correction overdue?
The US Federal Reserve’s monetary policy significantly impacts global markets, affecting interest rates, liquidity, investor sentiment and economic conditions. The US Fed’s decisions have a short to long-term impact on various assets including bonds, equities, gold, and the dollar.
In an exclusive interview with Financial Express Online, Atul Singh, MD and CEO of LGT Wealth India discusses which industries are most likely to do well this year and how the US Fed’s 2025 moves may affect investor strategy and global markets.
How will the US Fed’s 2025 actions shape global markets and investor strategies?
The Fed’s policies will hinge on controlling inflation while retaining economic growth. What seemed like a clear rate-cut cycle in 2025, has gotten muddied with Trump’s election. Trump’s potentially inflationary policies have led to the lowing of the rate-cut cycle. What the Fed would do will depend on how the inflation data comes out. For investors, diversified strategies will be key for investors navigating these uncertainties.
Which sectors are likely to outperform this year, and what’s driving their growth?
Technology and healthcare are expected to lead, driven by innovation, government initiatives, and demographic trends. Infrastructure may also gain traction, spurred by fiscal spending in developed economies.
Can Nasdaq stocks maintain their momentum or is a correction overdue?
While Nasdaq stocks remain attractive due to AI and tech innovation, valuation concerns, and potential interest rate shifts could trigger a pause. Investors should balance growth stocks with sectors offering resilience.
Are ‘Magnificent Seven’ stocks still a smart bet for global diversification?
These companies hold strategic advantages in innovation and market dominance, but concentration risks suggest pairing them with diversified global equities for balanced exposure.
How should Indian investors brace for potential inflationary policies?
Focus on inflation-hedged assets like gold, real estate, and high-quality equities. Fixed income with inflation-adjusted returns can also provide stability. Staying diversified across geographies will help mitigate localized inflationary risks.
What’s your view on the valuation versus growth potential of US tech giants?
Valuations are steep, but the growth potential remains robust, particularly in AI, cloud computing, and green tech. Investors should consider selective entry points, focusing on companies with sustainable earnings trajectories.
Is the tech sector losing its shine to traditional industries like infrastructure?
Not entirely. While infrastructure is gaining momentum due to fiscal policies, tech remains integral to innovation and efficiency across sectors. A dual focus can benefit portfolios.
How should Indian HNIs balance global investments amidst currency fluctuations?
Adopt a multi-currency strategy, investing in USD, and INR-denominated assets. Diversification across geographies and asset classes will mitigate currency risks.
Do alternative investments hold the key to wealth creation in 2025?
Yes, alternatives like private equity, venture capital, and real assets offer diversification and alpha opportunities. They are especially relevant for sophisticated investors seeking higher returns amid traditional market volatility.
What’s your top investment mantra for navigating market uncertainty this year?
Diversify globally, focus on quality, and stay patient. Diversified, long-term strategies well-aligned with macroeconomic trends often outshine short-term speculation.