Mumbai: The Reserve Bank of India (RBI) is expected to hold interest rates and keep its policy stance unchanged when the monetary policy is announced on Wednesday, according to 15 institutions surveyed by ET, as policymakers grapple with a sharply altered global backdrop amid the US-Israel conflict with Iran that has pushed up energy prices and raised fresh concerns over the fiscal deficit.

The six-member monetary policy committee meets April 6-8 for the first time since the war broke out on February 28.

Assessment of War’s Impact
While a policy pause is widely anticipated, economists said the RBI’s communication, particularly on the rupee and bond yields, will be closely scrutinised. Several respondents also expect the central bank to consider additional steps to shore up the currency amid persistent capital outflows.

“Further policy changes by the RBI and the India government to manage INR weakness could be likely,” said Michael Wan, senior currency analyst at MUFG Bank.

“These could include restrictions and higher import duties on gold and non-essential imports and a dedicated facility or FX swap window by the RBI so that oil marketing companies can tap dollars instead of going to the market.”
Most economists expect the central bank will avoid an aggressive response for now, preferring to assess the impact of the war and higher oil prices on the economy.“After two back-to-back circulars on the rupee, people are reminded of the 2013 playbook, but I think the story ends there,” said Abhishek Upadhyay, senior economist at ICICI Securities Primary Dealership, referring to moves by the RBI to rein in the Indian currency’s decline.

“It’s not 2013 and we don’t have a situation of a run on the currency.” Highlighting risks without committing to a policy trajectory is a good template to follow, said Sakshi Gupta, principal economist at HDFC Bank.

“If there is a hawkish commentary, it is likely to be balanced by stating that inflation is expected to remain within the comfort zone,” she said.

Gaurav Kapur, chief economist at IndusInd Bank, expects that the governor is likely to acknowledge rising risks to inflation, growth and the exchange rate, while highlighting macroeconomic and financial stability backed by adequate external buffers to absorb supply shocks.

Markets will focus on the RBI’s assumed crude oil price, which underpins its growth and inflation projections. India’s retail inflation stood at 3.21% in February.

In the last policy announcement on February 6, the RBI projected inflation for the first two quarters of FY27 at 4% and 4.2%, while GDP growth was seen at 6.9% and 7%, respectively.

Even as benchmark indices remain under pressure, analysts are gravitating towards selective bullish bets, backed by fresh build-up and breakout patterns in individual stocks. This tilt is because of deeply oversold market conditions, which are raising the odds of near-term pullbacks and short-covering rallies. A look at the top derivative picks of analysts.

BULLISH BETS

TITAN COMPANY
Change in Open Interest in April Series: 0.8% Change in price in April Series: 3.7% RATIONALE: Strong rollover into the April series, along with a lower roll cost of 0.31% (from 0.68%), shows traders are willing to pay to stay bullish, said Rajesh Palviya, head of technical and derivatives research at Axis Securities.

“As the Akshaya Tritiya festival nears, the market is bullish that the upcoming Q4 earnings will validate Titan’s ability to turn elevated gold prices into superior margins and footfalls,” he said. Palviya suggests buying on dips for a target of Rs 4,270-4,300, with a stop loss in futures at Rs 4,020-4,030.
ADANI POWER
Change in Open Interest in April Series: 98.95% (newly inducted in the futures segment) Change in price in April Series: 1.67% RATIONALE: The stock has witnessed a bullish breakout from a congestion zone of more than fi ve months with a signifi cant rise in volumes, said Vipin Kumar, AVP – derivatives and technical research at Globe Capital Market.

“The breakout is well supported by long buildup in the fi rst two trading sessions after its induction in the derivatives segment,” he said. Kumar said traders can buy its April Futures in the Rs 159-156 range for a target of Rs 170-175, with a stop loss at Rs 147.

NATIONAL ALUMINIUM
Change in Open Interest in April Series: -14.55% Change in price in April Series: 4%

RATIONALE: The stock has witnessed a close at the highest level on a weekly basis, said Sudeep Shah, head – technical and derivative research, SBI Securities. The fall in open interest and rise in share price point to short-covering. The stock is expected to move towards Rs 419-427 and can be bought with a stop loss at Rs 388, said Shah.

ABB INDIA
Change in Open Interest in April Series: 0.3% Change in price in April Series: 3.4%

RATIONALE: ABB’s higher-than-average rollover confi rms structural bullishness, said Palviya of Axis. “This transition from a high cost to a ‘discount’ during a price upswing suggests that long positions are being rolled with high conviction and effi ciency,” he said. “Investors are clearly looking past minor regulatory hurdles, positioning aggressively for a Q4 print expected to showcase scalable margins from massive greenfield infrastructure orders,” Palviya suggests buying on dips for a target of Rs 6,550-6,600, with a stop loss at Rs 5,950 (Futures rates).

JINDAL STEEL
Change in Open Interest in April Series: 0.67% Change in price in April Series: -1%

RATIONALE: Profit-taking in Jindal Steel from its all-time highs has halted near its previous breakout levels, which also coincide with the six-month exponential moving average, said Globe’s Kumar. “Considering its current chart positioning, we expect it to continue its prevailing uptrend, potentially reaching Rs 1220 in the immediate near term,” he said. Kumar advises buying its April Futures in the Rs 1,125-1,105 range, for a target of Rs 1,220, and stop loss at Rs 1,070

HINDALCO INDUSTRIES
Change in Open Interest in April Series: -1.8% Change in price in April Series: 3.6%

RATIONALE: The share surge, along with a decrease in open interest, suggests short covering. Fundamentally, the rally is underpinned by global supply shocks at EGA and Alba, which have bolstered LME aluminium benchmarks, said Palviya of Axis.

“Market focus now shifts to the Q4 earnings print, where these elevated benchmark realisations are expected to translate into sustainable margin expansion for both domestic operations and Novelis,” he said. Palviya suggests buying the stock on any dips for a target of Rs 980- Rs 1,000, and stop loss at Rs 875

BEARISH BET

PG ELECTROPLAST
Change in Open Interest in April Series: 17.8% Change in price in April Series: -3.3%

RATIONALE: The stock hit a fresh 52-week low of Rs 443.05 on Thursday. It has broken down from a consolidation, forming a lower high–lower low pattern on weekly charts, said SBI’s Shah. “It is trading below its short- and long-term moving averages, and we expect the stock to test lower levels,” he said. Shah recommends selling PGEL between Rs 438-443 with a stop loss at Rs 452 for a target of Rs 417.

The global stock market landscape has become increasingly complex, shaped by macroeconomic uncertainty, geopolitical risks, and shifting liquidity conditions. Yet, amid this volatility, timeless investing principles, such as those advocated by Joel Greenblatt offer a structured lens to interpret market behavior and identify opportunities.

A Market Driven by Noise, Not Always Value

Global equities today are influenced as much by sentiment as by fundamentals. Short-term movements are often erratic, driven by interest rate expectations, geopolitical tensions, and capital flows. As Joel Greenblatt highlighted in his bestselling book “The Little Book That Beats the Market.”, stock prices can fluctuate wildly in the short run without a corresponding change in the underlying business value .

This disconnect is particularly visible in current global markets:

US markets remain sensitive to monetary policy shifts and inflation data.

European equities face energy price volatility and growth concerns.
Emerging markets, including India, are navigating capital inflows alongside currency pressures.

Such conditions reinforce the idea that markets behave irrationally in the short term but tend toward efficiency over the long term.

The Rise of Factor-Based and Value Investing

In an environment where macro signals dominate headlines, investors are increasingly turning toward systematic strategies. Greenblatt’s Magic Formula, built on earnings yield (value) and return on capital (quality), offers a disciplined approach to stock selection.This framework aligns well with the current global scenario:

Earnings yield helps identify stocks that are undervalued relative to their earnings potential.
As global markets oscillate between growth and value cycles, such factor-based investing has gained traction among institutional and retail investors alike.

Mispricing Opportunities in a Fragmented Market

One of the defining characteristics of today’s global market is dispersion, while some sectors are richly valued, others remain overlooked. Greenblatt’s philosophy is rooted in identifying these inefficiencies.

Markets often misprice stocks due to emotional reactions and short-term narratives. This creates opportunities to buy good businesses at bargain prices, a principle also echoed by Warren Buffett.

In the current cycle:

Technology and AI-driven stocks may appear expensive but continue to command premium valuations.
Cyclical sectors like metals, energy, and financials often swing between undervaluation and sharp rallies.
Mid- and small-cap stocks globally present pockets of mispricing due to liquidity constraints and risk aversion.

Patience and Time Horizon: The Missing Edge

A key takeaway from Greenblatt’s approach is that even the best strategies can underperform in the short term. He emphasizes that lack of patience is one of the primary reasons investors fail to benefit from sound investment frameworks .

This insight is particularly relevant today:

Markets are reacting quickly to news, leading to frequent corrections and rallies.
Investors often chase momentum, abandoning long-term strategies prematurely.

In contrast, disciplined investors who stay invested across cycles are better positioned to capture long-term alpha.

Diversification and Risk Management in a Global Context

Global investing today demands diversification, not just across stocks, but across geographies and sectors. Greenblatt underscores diversification as essential to withstand adverse periods and allow a sound process to deliver results over time .

Given current uncertainties:

A diversified portfolio can balance developed and emerging market exposure.
Sectoral diversification helps mitigate risks from commodity cycles or policy changes.

India in the Global Equation

India continues to stand out as a relatively resilient market, supported by domestic demand, structural reforms, and earnings visibility. However, it is not immune to global shocks:

Foreign institutional flows remain sensitive to global liquidity.
Valuations in certain segments appear stretched, increasing the importance of selective investing.

Applying a disciplined approach can help Indian investors navigate this environment by focusing on quality businesses available at reasonable valuations.

Back to Basics in a Complex World

The global stock market may be entering a phase where macro uncertainties persist, but the core principles of investing remain unchanged. Greenblatt’s Magic Formula reinforces a simple yet powerful idea:

Successful investing lies in systematically identifying strong businesses trading at attractive prices, and having the patience to stay invested.

In a world dominated by noise, algorithms, and rapid capital flows, returning to such fundamental, value-driven frameworks may well be the most effective way to generate consistent long-term returns.

Mumbai: Banks have raised funds through certificates of deposit (CDs) at near two-year highs, reflecting intensified competition for resources and sustained pressure on liquidity, with policy rates remaining steady.

Data from the Clearing Corporation of India showed CSB Bank offered the highest rate at 8.32% for 91 days, followed by Ujjivan Small Finance Bank and Equitas Small Finance Bank, which raised funds at 8.25% for 366 days and 356 days, respectively. Other lenders such as HDFC Bank and IDBI Bank paid 7.6% for 33-day funds.

“While some firming is typical at year-end as banks shore up their balance sheets, this spike goes beyond seasonality,” said VRC Reddy of Karur Vysya Bank. “CD rates have moved to elevated levels, signalling deeper funding pressures rather than just a year-end phenomenon.”

HDFC Bank, the country’s most valuable lender, which has been under investor scrutiny following the sudden exit of chairman Atanu Chakraborty, raised funds at 7.6% for 33 days on March 27, mobilising ₹4,300 crore. Punjab National Bank raised ₹1,175 crore at 7.5% for the same tenor. These rates are well above the 3.25% banks typically pay retail depositors for 30- to 45-day deposits. Most banks pay around 6.25% to 7% for one-year deposits.

“The CD rates do appear high when compared with retail deposit rates or the card rates published by banks, largely because deposit growth has lagged credit growth,” said Anil Gupta, co-group head for financial sector ratings at ICRA.
Overall, HDFC Bank raised ₹23,090 crore during the last fortnight across tenors ranging from 33 to 327 days, paying interest rates between 7.3% and 7.6%. Data showed Axis Bank raised ₹3,500 crore at 7.6% for 92 days, IndusInd Bank raised ₹2,075 crore at around 7.5% for tenors ranging from 91 to 94 days, while Bandhan Bank paid 7.85% for 186 days on a ₹125 crore CD.During the fortnight ended March 31, banks issued ₹1.07 lakh crore of CDs, broadly in line with issuance in the corresponding fortnight last year.

CD rates had earlier climbed sharply during periods of tight liquidity, peaking at about 8.15% between February and March 2024, according to historical data.

Reddy said elevated CD rates reflect a combination of tight systemic liquidity, pressures linked to liquidity coverage ratio requirements, and tactical balance-sheet management amid weak deposit mobilisation.

“In this backdrop, banks have prioritised certainty over cost, relying on CDs and other bulk funding to secure immediate and assured resources,” he said.

ICRA’s Gupta said while CD rates are high, such issuances are typically used to plug short-term mismatches in asset-liability flows. “Certificates of deposit account for only 2.6% of overall bank deposits and do not materially increase the overall cost of deposits,” he said.

Union Bank of India raised ₹24,060 crore, while Punjab National Bank mobilised ₹12,450 crore in the last fortnight of March, offering rates ranging between 6.9% and 7.5%, the data showed.

Banks paid higher rates for shorter-tenor CDs than for longer maturities.

Reddy said CD rates may ease from the March-end spike but are unlikely to soften meaningfully in FY27. “The underlying drivers – tight liquidity conditions, a persistent credit-deposit mismatch and pressure on deposit mobilisation – are structural rather than transient,” he said.

Brazil, Japan, Mexico, South Africa and the US have stopped importing Spanish pork. Other countries, such as EU members, China and the UK, have taken a more localised approach, only banning pork that originates in the affected area of north-eastern Spain.