The recent correction across commodities has sparked concerns among investors, but market expert Dharmesh Kant from Cholamandalam Securities believes the pullback should be viewed as an opportunity rather than a warning sign. Speaking to ET Now, Kant said the broader commodity cycle remains intact, supported by improving global demand, infrastructure spending and India’s economic momentum.

Copper, aluminium, crude oil and silver have all witnessed sharp declines over the past few sessions, dragging commodity stocks lower. However, Kant believes such corrections are a normal part of long-term commodity cycles.

“Commodity as an asset class is always like this. Whenever the upside is there, it continues for one or two years. We have already seen a major part of the upcycle, and normally it corrects and consolidates for a meaningful period,” he said.

According to Kant, demand fundamentals remain favourable. He expects industrial demand for metals such as aluminium, copper and zinc to strengthen as global economic activity improves. Silver, too, continues to enjoy structural support due to its widespread use in electric vehicles, electronics and renewable energy.

“Silver demand has an industrial connotation. Electric vehicles, electronics and solar panels all use silver, and demand is likely to compound at 15-17% CAGR going forward,” he said.

Given this backdrop, Kant believes quality commodity companies deserve fresh attention.
“This is a good opportunity to accumulate good-quality commodity stocks. One can look at Hindalco, Vedanta and JSW Steel. We still believe there is at least one to one-and-a-half years of the upcycle left,” he added.Lower Crude Prices to Aid Corporate Margins
Kant also expects the sharp decline in crude oil prices to provide a meaningful boost to corporate profitability over the coming quarters.

He noted that while companies may see some impact in the June quarter, the benefits of lower input costs should become much more visible during the second half of the financial year.

“Q2 and Q3 will have the benefit of lower input costs, but price rollbacks never happen. That will support better profitability in the second half of the year,” he said.

He also believes easing tariff concerns and resilient domestic demand have strengthened India’s macroeconomic outlook.

“Our ground checks suggest there has been no let-up in consumption, credit demand or collections. Credit growth itself will be around 17-18%, and these indicators suggest this is the time to be bold with cherry-picking,” Kant said.

Defence Story Remains Intact
Despite recent volatility in defence stocks, Kant remains optimistic about the sector’s long-term prospects. While he is less constructive on Bharat Dynamics, he continues to favour Bharat Electronics (BEL), Hindustan Aeronautics (HAL) and Mazagon Dock Shipbuilders.

Recent selling pressure, he said, has largely been driven by trading positions and news flow rather than any deterioration in fundamentals.

“It is a no-brainer if you are looking from a three-year perspective. HAL, BEL and Mazagon Dock remain strong long-term plays,” he said.

Kant also highlighted the potential of the long-awaited P-75 submarine project, which could significantly expand Mazagon Dock’s order book and transform its growth trajectory.

Cautious on AI-Themed Stocks
On India’s artificial intelligence investment theme, Kant advised investors to separate genuine long-term opportunities from market narratives.

Discussing Sterlite Technologies, he acknowledged the company’s strong order book but questioned the sustainability of its business model.

“There is no IP or moat in the business. It has largely remained a trading play over the last 10-15 years, so we are staying away from the fundamental call,” he said.

Banking Preferred Over Auto and Ancillaries
Among sectors that could benefit from lower crude prices, Kant prefers banking and financial services over automobiles and auto component manufacturers.

While paint companies have already recovered significantly from recent lows, he believes expensive valuations and intense competition limit their upside. Auto and ancillary companies, meanwhile, could struggle because of a high base effect in the second half of the year.

“If you are looking at a one- or two-year perspective, they may find it difficult to deliver 20-25% profitability growth. It is a tactical call to stay away for now,” he said.

Instead, he believes banking remains the strongest indirect beneficiary of improving macroeconomic conditions and lower energy prices, making it one of the preferred sectors for investors over the coming quarters.

Plans to cut prices at family attractions over the summer holidays will be a “wonderful initiative” to help more people visit, a business has said.

Government plans coming into force on Thursday will cut VAT on some tickets to attractions in the UK, with the discount expected to be passed on by businesses to customers.

James Robson, general manager of Birdworld in Farnham, Surrey, said that he hoped the move would make visiting easier for families with less money, but also called for a more lasting initiative to help attractions.

“This opens up accessibility to people who might be feeling the strain over the summer holidays,” he said.

“It’s a wonderful initiative that looks to provide a bit of tax relief through the summer holidays.

“It’s getting more and more expensive to run these attractions, and long term it would be good to see further relief.”

Global markets are drawing confidence from easing geopolitical tensions, cooling oil prices, and another round of robust earnings from artificial intelligence (AI)-linked companies, according to Matt Orton from Raymond James Investment. With crude oil retreating from recent highs and optimism surrounding AI remaining intact, investors are increasingly viewing market pullbacks as buying opportunities rather than reasons for caution.

Speaking to ET Now, Orton said that while uncertainties remain around global trade negotiations, the removal of worst-case economic scenarios has significantly improved investor sentiment.

“We are removing left-tail scenarios from the table. Some of the worst-case outcomes continue to be taken away, and that is encouraging… All of this is fuel for markets to continue to move higher, and it supports my optimistic case to buy the market on weakness and continue to hold it throughout the rest of this year,” he added.

AI Companies’ Debt Not a Major Concern

Addressing concerns over rising debt issuance by AI and semiconductor firms, Orton argued that investors should focus on individual company fundamentals rather than broad market narratives.

“Most of these companies have incredibly low debt burdens overall… The majority of the hyperscalers’ balance sheets remain incredibly clean, and I do not have concerns with respect to their ability to fund and finance,” he said.Dollar Strength Could Continue to Pressure Emerging Markets
Orton believes the US dollar remains an underappreciated driver of global markets, particularly for emerging economies like India.
He said a stronger dollar has affected foreign investment flows and created headwinds for commodities, including gold and silver.
“The dollar is going to be the sleeper factor… Rupee weakness has been a key reason why foreign investors have been a little bit resistant to put money back in. Until you start to see the dollar weaken, you are going to continue to see pressure across the broader emerging market complex,” he said.

Micron Results Reinforce the AI Growth Story
Micron Technology’s latest earnings, according to Orton, demonstrate that AI-driven demand remains strong and that supply constraints could persist for several more years.

“Even the whisper numbers on the buy side were met or exceeded… You are still seeing more backlogs being added, margins being strengthened, and that is just a recipe for continued gains,” he said.

He added that investors should continue focusing on high-quality companies benefiting from strong earnings momentum.

Market Optimism Is Narrow, But Opportunities Remain
While sentiment has improved considerably, Orton cautioned that the rally is concentrated in a handful of semiconductor stocks rather than the broader market.

He also noted that increasing use of leveraged investment products could lead to greater volatility.

“Investor sentiment is very narrow… It creates opportunities, but it also means investors really need to manage risk,” he said.

Despite the concentration, Orton believes diversified exposure remains the best strategy.

“To me, that is an opportunity to own markets like India, Europe, and Japan because those are good diversifiers to that really high beta that you might have in your overall portfolio,” he said.