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Nifty on the Daily Chart

The markets were completely down and out this week, and what makes this particularly striking is the timing — we are barely four trading sessions away from the Union Budget on 1st February. Sentiment remained deeply negative throughout the week, driven largely by uncertainty around geopolitics and trade narratives. Then, almost ironically, breaking news emerged on Saturday that the US Treasury Secretary has called for a potential removal of the 25% tariff on India.

As has been evident for several weeks now, markets seem to be dancing to narratives emerging from the White House, and this is yet another headline in that series. Whether this proposal actually translates into policy is uncertain, but it does give markets something to latch onto. If nothing else, it offers a possible reason for relief or a bounce when markets reopen on the 27th of January.

From a technical standpoint, the Nifty daily chart looks deeply oversold and heavily beaten down. The index lost about 2.5% over the week and has been stuck in a continuous downtrend ever since it became clear that the US trade deal was not happening in the near term.

Nifty – Weekly Chart Perspective

More importantly, on the weekly chart, Nifty has broken below a critical trend line that it had earlier broken out of in October. This breakdown suggests structural damage, and before any sustainable upside move can occur, the market will need to build a base and regain stability. At this point, the market is not in a position to rally impulsively; repair work is required.

S&P 500 Overview

In sharp contrast, US markets continue to remain remarkably resilient. The S&P 500 is trading around 6,915 and was down only about 0.35% for the week. Despite global volatility and risk-off sentiment elsewhere, US equities appear largely unfazed, once again highlighting the divergence between US markets and most other regions.

GOLD Overview

Gold, on the other hand, delivered an extraordinary performance, rising a staggering 9.6% in a single week. This is an exceptionally rare move — something that has not been seen in a very long time. While there may have been isolated weeks in the past with 7–9% moves, this week’s rally was unusually clean and decisive. Predictably, many commentators are calling it a speculative or FOMO-driven rally, but that explanation misses the bigger structural shift underway.

The reality is that the global system is gradually moving away from holding excessive US Treasuries and sovereign debt. Central banks are steadily increasing gold allocations as a share of their reserves — from roughly 10% a few years ago to nearly 25% today. Over time, this could rise to 60–70%. Whether this transition takes two years, five years, or a decade is uncertain, but the direction of travel is clear.

Dollar Index Overview

Supporting this view is the Dollar Index, which now appears to be at the cusp of a meaningful breakdown. Once that breakdown occurs, it could act as a strong tailwind not just for gold, but also for emerging markets. Unfortunately for India, this benefit has not yet materialized because the USD-INR continues to rise even as the dollar weakens against other major currencies. This divergence indicates a significant slippage in the rupee versus global peers, compounding India’s relative underperformance.

Global Indices Overview

This weakness is starkly visible in the global equity comparison chart in dollar terms. When markets are normalized to the dollar, Brazil stands out dramatically, rising nearly 10% in just one week. Clearly, emerging-market flows have gone decisively into Brazil rather than India. During the same period, Nifty 50 fell about 3.8% and Nifty 500 declined nearly 4.6%, while most other global markets remained largely muted. India, once again, stands out — but unfortunately on the downside.

Global Momentum

Looking at global momentum rankings by country, Brazil is firmly at the top across timeframes. Japan follows in second place, with Canada occupying the third spot. India finds itself at the bottom of the table, alongside the S&P 500 and Dow Jones, underscoring how sharply relative momentum has deteriorated.

Benchmark Indices Overview

Domestically, the benchmark indices suffered a brutal week. Small caps were hit the hardest, plunging about 5.5%, while mid caps declined around 4.4%. Nifty Next 50, Nifty 500, and Nifty 50 all ended the week significantly lower. On a one-year basis, small caps are now in negative territory, while the broader market is largely flat. Nifty 50 is still up about 7.9% in rupee terms over the last year, but in dollar terms, returns are flat to negative. This makes India unattractive from a foreign investor’s perspective, as dollar-based returns over the last year have essentially been zero. Over five years, Nifty has delivered about 11.75% CAGR — close to its historical average — indicating a full mean reversion. Mid and small caps, however, remain above historical averages, suggesting further mean reversion could still be ahead.

Sectoral Overview

Sectorally, the damage this week was severe and broad-based. Real estate collapsed by over 11%, completely losing its footing. Capital market stocks fell 6.6%, tourism declined 5.3%, and media dropped 4.2%. There was no sector that managed to post gains this week, reflecting widespread risk aversion and forced selling.

Sectoral momentum scorecard shows metals still at the top, followed by PSU banks and MNC stocks. Commodities occupy the fourth position. At the bottom are real estate, tourism, media, and energy. Interestingly, in the very short term, FMCG has started to show some improvement, while capital markets continue to weaken. Services and pharma are also beginning to show early signs of short-term strength, though these remain tactical rather than structural shifts for now.

IMPORTANT ANNOUNCEMENT

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Introducing All Seasons

Markets reward patience — but rarely make it easy.
Even index investors — owning India’s top 50 companies through the Nifty 50 — struggle to stay the course. Drawdowns hurt, flat markets drain conviction, and emotions often break compounding faster than crashes do.

That’s exactly why we built All Seasons — a simple, rule-based strategy that helps you stay invested through every phase of the market by dynamically balancing between Nifty 50 (for growth) and Gold (for stability).

📈 Growth — Nifty 50
Own India’s strongest 50 companies — the backbone of our economy. Participate in the nation’s long-term growth story without picking stocks or timing entries.

🛡️ Stability — Gold
Crises strike without warning. Gold rises when equities stumble — acting as your portfolio’s natural hedge and emotional anchor.

⚙️ The Engine Behind It
All Seasons shifts allocations every fortnight based on market conditions:

• When equities run hot, exposure trims automatically.
  
• When they’re beaten down, the system increases weight.
  
• Gold moves in the opposite direction — balancing every phase.
  

No guesswork. No emotion. No fear of missing out — just a calm, intelligent portfolio that adapts to markets for you.

Who is this for?
✅ Index investors who want smoother participation
✅ New investors who prefer ETFs over stock-picking
✅ Professionals who can’t invest in direct equities
✅ Seasoned investors looking to add stability to their core
✅ Anyone who wants to stay in control without daily decisions

Price: ₹4,999 per year
Recommended Capital: ₹2–30 lakh

Introducing Mi Allcap GOLD

Mi Allcap GOLD is designed for investors who want broad equity exposure with a built-in hedge. It combines:

25% Large Caps – for stability

25% Mid Caps – for growth

25% Small Caps – for alpha

25% Gold ETFs – as a permanent hedge

Mi AllCap GOLD follows a rules-based, momentum-driven approach to select the strongest stocks in each segment. The portfolio is rebalanced monthly to ensure it stays aligned with market leadership — with no human discretion involved.

Why Mi AllCap GOLD?

All-in-one exposure to all equity tiers + gold
Rebalance Frequency : Monthly
Momentum Style : Rotational

Whether you’re just starting your wealth journey or looking to anchor your core portfolio, Mi AllCap GOLD offers a powerful blend of momentum, diversification, and downside protection.

Don’t just diversify — balance wisely.

Rebalance Update

We give advance notice here on the upcoming changes in your smallcase for Monday. This advance notice can be used to ignore Monday’s update if there is no change. If there is a change indicated you

Note: We are not including LIQUIDBEES as an ADD or an EXIT count.