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Speaking on the sidelines of CNBC-TV18’s India Business Leader Awards (IBLA) 2024, Holland cautioned the D-Street of a very volatile January ahead as the Donald Trump administration is set to take over in the US.
“January 20 is a big event, Trump is taking over the US administration. That’s an event we have to be very careful about. So, I’m very cautious between now and then,” he told CNBC-TV18.
He believes that while FIIs may go on holiday in the second half of December, domestic domestic will have the full range for investing but come January, all bets will be off. “It’s going be a very volatile January ahead of us.”
When asked if he would recommend lightning positions, he said sometimes the strategy is having cash, waiting for some of these events to pass and then making a move. Even if one misses the first five percent of gains, that’s okay, as there’ll be a longer bull run but one should be reasonable to not get caught in the volatility, he said.
Explaining the reason behind being so cautious about Trump 2.0, Holland said, “there’s many things about tariffs, the narrative for India… Sometimes, it doesn’t always work out the way everyone says. I’m just a bit skeptical, so just being cautious is the right way to be.”
Few days after Trump 2.0 takes over, India will be ready with its Budget 2025 in February. Against the backdrop of a slowdown in growth in Q2 and the upcoming budget, Holland said there is no reason to get really excited.
He is of the view that there is no catalyst for the markets to go very high as valuations are already very high, the economy is slowing quite quickly and there’s no rate cut. Therefore, even if government spending picks up, the multiplier effect may not be very quick and so, earnings are going to remain under pressure for the rest of this year.
