The India equity benchmarks may have closed at a new high on June 16 after much waiting but Zerodha co-founder and CEO Nithin Kamath has said the trend does not still indicate a bull run, pointing to weak retail participation.
The founder and CEO of India’s largest brokerage tweeted, “Markets are back at all-time highs, but it doesn't feel like a bull run because retail activity isn't picking up. Active clients on NSE, Google & social media trends are way below all-time highs. Unlikely that activity will pick up given the higher interest rate environment”.
Google Trends’ data shared by him is also revealing.
According to him, Zerodha’s competition isn’t coming from peers but from the fixed-income market.
“I keep telling our team that our competition is really the bank's fixed-deposit rates, not our peers. Most retail investors question whether taking the added equity risk is worthwhile when govt bonds and FDs yield 7%+," he tweeted.
However, the market seems divided, with optimism a head above pessimism.
Kamath ran a poll on this Twitter thread asking the question: What do you think will happen?
At 3.15 pm, after polling over 5,500 votes, the maximum number of people –or 39.3 percent—voted for "The momentum will be back". The second highest votes —34.9 percent — were for "The bears will be back". The remaining-25.9 percent—voted "No idea".
The 3o-pack Sensex gained 466.95 points to end at 63,384.58, while the broad-based Nifty ended 137.90 higher at 18,826. The previous record closing was on December 1, 2022. With the Sensex at 63,284.19 and the Nifty at 18,812.50.
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