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Tensions in Middle-East are rapidly inching closer to their zenith, with Iran firing about 200 ballistic missiles at Israel late yesterday night. In response today, the Indian markets witnessed their worst decline in two months, with Sensex dipping around 1,769 points, or 2.1% to close at 82,497.10. <keyword id="19896381" type="General" weightage="20" keywordseo="Nifty" source="keywords">Nifty</keyword> followed suit and was also down by 2.1% to close the day at 25,250.10. As a result, about Rs 11 lakh crore were wiped off the market today. The decline was broad-based, with sectors like realty (dipped by over 4%) auto, and energy suffering the most. Broader indices also fell, losing nearly 2% each. The Hang Seng index, which had rallied over 14% during the last week, largely on the back of various stimulus measures announced by the central bank to stir consumption in the Chinese economy, also slumped around 1.47%. With the possibility of an all-out war between Iran and Israel looming on the horizon, threatening to happen sooner than later, markets are expected to remain volatile in near future. Even the India VIX, seen as a gauge of uncertainty and investor fear in the market, jumped over 9% during the day. The war could throw a huge spanner on India's crude oil import plans. As of August 2024, about 44.6% of India's crude oil imports came from <keyword id="19904316" type="General" weightage="20" keywordseo="middle-east" source="keywords">Middle East</keyword>. Israel has already promised significant retaliation, in response to Iran's attack in the days to come. And the strong possibility of a full-blown Israeli attack in Middle East, particularly major oil fields in Iran has sent the crude oil prices surging. Closer home, ONGC (Oil and Natural Gas Corporation) was amongst the biggest gainers on NSE today. <h2>Should Indian investors worry? </h2>But is the impending action in Middle-East the only reason behind today's drastic fall? Vishnu Kant Upadhyay, AVP, Research &amp; Advisory at Master Capital Services notes that while it plays a significant role, other factors are also at play. "Recent regulatory changes in the F&amp;O segment by SEBI is expected to impact trading volumes, as retail participation may decline due to the increased contract size and limits on weekly expiries. Meanwhile, strength in the Chinese market, following the People’s Bank of China (PBoC) stimulus package, has also diverted foreign investment to China, where valuations remain more attractive compared to India", he noted. But Upadhyay believes that the extension of losses in Indian markets wont last long. "From a technical perspective, as long as prices hold above the 25,250–25,100 zone, any decline could present an opportunity to build fresh long positions. A stock-specific approach is advisable, with sectors such as Oil, IT, PSU Banks, Metals, and Chemicals likely to outperform in the coming days", he adds. Shrikant Chouhan, Head Equity Research, Kotak Securities observes that as long as market is trading below 25,365/82,800, the weak sentiment is likely to continue. On the down side, it could slip till 25,150-25,025/82,200-82,000 as well. On the other side, one quick technical pullback is likely if the market succeeds to trade above 25,365/82,800. Above the same, it could bounce back till 25,475-25,500/83,100-83,300. The current market texture is volatile hence; level based trading would be the ideal strategy for the day traders. <h2><keyword id="20760178" type="General" weightage="20" keywordseo="mutual-fund-investors" source="keywords">Mutual fund investors</keyword>, stay put</h2>In the aftermath of a <keyword id="19968045" type="General" weightage="20" keywordseo="market-correction" source="keywords">market correction</keyword>, most mutual fund investors often face a critical decision- should they stop their SIPs (<keyword id="21047553" type="General" weightage="20" keywordseo="Systematic-Investment-Plans" source="keywords">Systematic Investment Plans</keyword>) or to view the downturn as a valuable opportunity to acquire more mutual fund units? By continuing SIPs during such downturns, investors can take advantage of 'rupee-cost averaging,' i.e. accumulating more units when prices are down. This approach not only lowers the average cost per unit, but also positions the portfolio for greater returns when the market eventually recovers, and softens the impact of short-term volatility. Swapnil Aggarwal, Director, VSRK Capital explains that alongside maintaining regular investments, revisiting your asset allocation is also essential in these turbulent times. A well-diversified portfolio, that balances equities with safer assets like bonds can withstand market fluctuations more effectively. You can consider shifting some investments into bond funds or other stable instruments, which can provide a cushion against further declines. <h2>What happens next? </h2>While the immediate impact of a market correction may lead to declines in the NAV (Net Asset Value) of mutual funds, disciplined investors can view this as a moment to reassess their strategies. Focusing on your <keyword id="20908416" type="General" weightage="20" keywordseo="long-term-financial-goals" source="keywords">long-term financial goals</keyword> will let you turn market volatility into opportunity! The market will remain keenly focused on the evolving situation in the Middle East. What will also be equally important are the US monthly jobs data due tomorrow, which could determine the size of Fed's next interest rate move in November.

Nifty, Sensex in freefall today as Iran mounts attack on Israel. Here's what experts think you should do

<ul><li><keyword id="859162" type="General" weightage="100" keywordseo="Kotak-Investment-Advisors" source="Orion">Kotak Investment Advisors</keyword> secured an anchor commitment of $500 million from the Abu Dhabi Investment Authority (<keyword id="6482676" type="General" weightage="80" keywordseo="adia" source="Orion">ADIA</keyword>).</li><li>Domiciled in Gujarat’s GIFT City, Kotak Investment Advisors’ new fund will target residential <keyword id="6354553" type="General" weightage="20" keywordseo="real-estate" source="Orion">real estate</keyword> investments.</li><li>The alternate assets arm of the Kotak Mahindra Group had earlier raised $590 million from an ADIA unit this June towards the office space market.</li></ul>Kotak Investment Advisors secured an anchor commitment of $500 million from the Abu Dhabi Investment Authority (ADIA) for its $1 billion <keyword id="172775" type="General" weightage="20" keywordseo="real-estate-fund" source="Orion">real estate fund</keyword>, the company said on Tuesday. Kotak Investment Advisors is an alternate assets arm of the Kotak Mahindra Group. With the anchor commitment from ADIA, Kotak Investment Advisors has raised, managed or advised more than $3.3 billion across its 13 real estate funds, the company said. Kotak Investment Advisor’s 13th real estate fund will primarily target the residential sector. “The new platform is primarily targeted at the significant demand for housing in India, which is driven by sustained economic growth and a shortage of urban housing clusters,” said Mohamed AlQubaisi, executive director of ADIA's real estate department. It is domiciled in Gujarat’s GIFT City, and will focus on markets like Mumbai, Bengaluru, Delhi-NCR, Pune, Hyderabad and Chennai. “This is an opportunistic fund which can invest across various real estate asset classes and capital stack, that is, both debt and equity. With the first close of this Fund, KIAL has raised around $1.5 billion in real estate across multiple strategies in around one and a half years,” said Vikas Chimakurthy, CEO, Kotak Realty Fund. Earlier in June, the company had entered into an agreement with an ADIA unit to set up a $590 million real estate platform, aimed at meeting the long-term demand for office spaces across the country. <cmsannotation type="cmsannotation" annotationid="Home sales rise 119% year-on-year in H1 FY23 in top seven cities" comment="subhead" text="Home sales rise 119% year-on-year in H1 FY23 in top seven cities">Home sales rise 119% year-on-year in H1 FY23 in top seven cities</cmsannotation> Home sales rose 119% year-on-year in H1 FY23 across the top seven cities of the country. According to an<a href="https://www.businessinsider.in/business/news/early-diwali-for-developers-homes-worth-1-5-lakh-cr-sold-in-top-7-cities-in-h1fy23/articleshow/95405843.cms"> Anarock report</a>, homes worth ₹1,55,833 crore were sold between April and September this year, up from ₹71,295 crore in the same period last year. In terms of units, 1,73,155 units were sold in H1 FY23, up from 87,375 units in H1 FY22. Mumbai alone accounted for 48% of the total value of homes sold in this period, with Delhi-NCR and Hyderabad in second and third places, respectively, maintaining their positions from the previous year. “The data vouchsafes that the first half of FY23 was a highly upbeat period for the residential market in the top 7 cities, allaying fears that housing sales could be impacted by rising property prices and interest rates,” said Anuj Puri, chairman, Anarock Group. SEE ALSO: <a href="https://www.businessinsider.in/business/corporates/article/tatas-mega-aviation-merger-is-poised-for-flight-but-the-skies-are-not-clear-yet/articleshow/95526116.cms">Tata's mega aviation merger is poised for flight, but the skies are not clear yet</a> <a href="https://www.businessinsider.in/business/news/95-indian-companies-experiencing-new-types-of-fraud-after-covid/articleshow/95530428.cms">95% Indian companies experiencing new types of fraud after Covid</a> <a href="https://www.businessinsider.in/stock-market/news/fusion-micro-finance-lists-at-a-2-discount-amid-volatile-market-conditions/articleshow/95523776.cms">Fusion Micro Finance lists at a 2% discount amid volatile market conditions</a>

ADIA commits $500 mn to Kotak Investment Advisors’ $1 bn real estate fund

<ul><li>Since robo-advisors automate the process of arriving at investment decisions; it leads to cost savings and removal of human bias. </li><li>The choice between a human financial advisor and a robo advisor depends on an individual's specific needs and preferences. </li><li>For comprehensive financial planning, especially for complex situations, a human advisor may be more suitable. </li></ul>The term <keyword id="2775654" type="General" weightage="20" keywordseo="robo-advisor" source="Orion">robo-advisor</keyword> is self-explanatory- it is s robot that gives investment advice. But while it may conjure up the notion of a robot, to put it simply, a robo-advisor is an automated, online financial platform that utilises <keyword id="834399" type="General" weightage="20" keywordseo="algorithms" source="Orion">algorithms</keyword> and data analysis to provide investment advice and manage portfolios for individuals. <cmsannotation type="cmsannotation" annotationid="Robo-advisors: Still at a nascent stage in India" comment="Subhead" text="Robo-advisors: Still at a nascent stage in India">Robo-advisors: Still at a nascent stage in India</cmsannotation> Robo-advisory services are still in their nascent stages of development in India. In terms of usage, they are primarily embraced by a limited group of early and tech-savvy adopters. “In terms of coverage, robo-advisory seems largely restricted to listed equities for now with limited coverage around ETFs and other products as well. Most robo-advisors offer quantitative or algorithm-based portfolio management services,” says Nirav Karkera, head, research, Fisdom, wealth tech platform. <cmsannotation type="cmsannotation" annotationid="How they work" comment="Subhead" text="How they work">How they work</cmsannotation> Robo-advisors are digital platforms that help you invest your money. First, they ask you questions about your financial goals and how comfortable you are with risk. Then, they use computer algorithms to recommend where to invest your money. They also manage your investments over time and adjust them as needed. It's like having a smart computer friend who handles your finances. “Using information you provide, the robo-advisor algorithm chooses a diversified array of assets, including ETFs, stocks, and mutual funds, and subsequently, autonomously readjusts the portfolio to sustain the target asset allocation,” says Rachit Mehta, head, product strategy, IIFL Securities. <cmsannotation type="cmsannotation" annotationid="Do robo-advisors lead to cost savings?" comment="Subhead" text="Do robo-advisors lead to cost savings?">Do robo-advisors lead to cost savings?</cmsannotation> No frills robo advisory tools could translate into cost savings for the do It yourself (DIY) investors. “These tools automate the process of arriving at investment decisions without human involvement; it leads to cost savings and removal of human bias,” says Abhishek Kumar, founder and chief<a href="https://business.outlookindia.com/invest/investment"> </a>investment advisor at SahajMoney, a financial planning firm. Robo-advisors are <keyword id="423471" type="General" weightage="20" keywordseo="cost-effective" source="Orion">cost-effective</keyword> because they automate the investment process. “They have lower fees compared to traditional advisors since they don't require in-person meetings or offer personalised financial planning. This cost efficiency can lead to higher net returns for investors over time,” says Mehta. However, Sadique Neelgund, founder and director, Network FP, a membership organisation for personal financial advisors, has a more nuanced take. “The answer is both yes and N\no. Yes, if you are able to generate 1% to 2% higher returns by doing it yourself viz. a viz. working with a professional human advisor. This is really tough considering the majority get trapped by investment biases. No, if you are unable to perform better <keyword id="35175" type="General" weightage="20" keywordseo="investing" source="Orion">investing</keyword> directly through robo-advisors,” he says. That being said, given the early stage of robo-advisory adoption in India and the fragmented nature of robo-advisory offerings, it is difficult to carry out a standardised comparison between robo-advisory and traditional advisory approaches. <cmsannotation type="cmsannotation" annotationid="What kind of investors are robo-advisors suited for?" comment="Subhead" text="What kind of investors are robo-advisors suited for?">What kind of investors are robo-advisors suited for?</cmsannotation> Is a robo-advisor suited for you? “DIY, tech savvy investors with uncomplicated, simple and small portfolios are best suited for robo-advisory,” says Renu Maheswari, co-founder and principal advisor, Finscholarz Wealth Managers. Robo-advisors are a great fit for cost-conscious investors who seek an automated investment approach. They work well for individuals with moderate risk tolerance, favouring a hands-off, diversified investment style. However, robo-advisors may not be the right choice for those in need of intricate financial planning or highly personalised investment strategies. “Considering the early phase that robo-advisory is in today and the fact that most such models are yet to undergo major macroeconomic, business and market cycles, most robo-advisory services may be suitable to informed investors who are aware about the principles, commitments and possible shortcomings of such platforms,” says Karkera. Early adopters may also try to allocate some part of their portfolio to be managed through a robo-advisory to be able to eventually compare the effectiveness and efficiency of such a platform and eventually make an informed decision. <cmsannotation type="cmsannotation" annotationid="Should you use a robo-advisor?" comment="Subhead" text="Should you use a robo-advisor?">Should you use a robo-advisor?</cmsannotation> The choice between a human financial advisor and a robo-advisor depends on an individual's specific needs and preferences. “For comprehensive financial planning, especially for complex situations, a human advisor may be more suitable as they provide personalised guidance,” says Maheswari. However, for investment portfolio management, a robo-advisor can be cost-effective and efficient, particularly for those who have clear investment goals and are comfortable with a more automated approach. <cmsannotation type="cmsannotation" annotationid="A word of caution" comment="Subhead" text="A word of caution">A word of caution</cmsannotation> Modern portfolio theory (MPT) is a framework for constructing investment portfolios that aim to maximise expected return for a given level of risk. However, MPT has its limitations, as it relies on the assumption that investors are rational and risk-averse, which may not always accurately reflect real-world investor behaviour. “As we have seen in the past in volatile markets not all investors behave in a rational manner hence the performance of robo-advisory tools built on MPT will also suffer due to investors' irrational behaviour,” says Kumar. So investors are advised to exercise caution and first understand the workings of robo-advisory before using it for their investments.

Explained: What are robo-advisors and should you use one for your investing decisions?

<ul class="summary-list"><li>This post originally appeared in the Insider Today newsletter.</li></ul>Welcome back! We're a little over halfway through the Olympics, but there have already been some incredible photos. <a target="_blank" href="https://www.businessinsider.com/paris-olympics-best-photos-viral-2024-8">Here are some of the best</a>.In today's big story, interest-rate cuts are almost certainly coming, <a target="_blank" href="https://www.businessinsider.com/job-market-unemployment-outlook-fed-rate-cuts-layoffs-hiring-cuts-2024-8">but the relief won't be felt immediately</a>. It begs the question: <a target="_blank" href="https://www.businessinsider.com/jobs-unemployment-interest-rates-economy-recession-soft-landing-2024-8">Are the chances of a soft landing doomed</a>?What's on deck:<ul><li>Markets: Hedge funds' July report cards are in, including an update from <a target="_blank" href="https://www.businessinsider.com/july-hedge-fund-performance-jain-global-citadel-millennium-2024-8">the new kid on the block</a>.</li><li>Tech: One man's apprehensive journey to push the <a target="_blank" href="https://www.businessinsider.com/oppenheimer-artificial-intelligence-michal-kosinski-predict-facial-recognition-2024-7">boundaries of what AI is capable of</a>.</li><li>Business: Life isn't perfect, so maybe it's time <a target="_blank" href="https://www.businessinsider.com/consumerism-capitalism-optimization-culture-live-medium-average-good-enough-2024-8">we all embrace being average</a>.</li></ul>But first, oh boy.If this was forwarded to you, <a target="_blank" href="https://www.businessinsider.com/subscription/newsletter/insider-today">sign up here.</a><h3 id="7fa5f018-5b05-4a37-a8dc-d3f89138bcb3">The big story</h3><h2 id="5fd547b9-ec52-41fc-8e08-4f4b27dd8097">Crash landing</h2><div type="image" title="Jerome Powell in front of a bar and line graph" height="1500" width="2000" msid="112294401" hostid="261" sizebytes="283498"></div>Our bend-don't-break economy might finally have reached its limit.After a year of resiliency in the face of high interest rates, the cracks are showing in the US economy.July unemployment data released Friday <a target="_blank" href="https://www.businessinsider.com/unemployment-rate-job-growth-july-labor-market-economic-data-2024-7">came in unexpectedly high</a>. The US added 61,000 fewer jobs than expected, and the unemployment rate rose to 4.3%, its highest level since October 2021.Investors were already on edge from a rise in jobless claims and weak manufacturing data on Thursday, so it wasn't long <a target="_blank" href="https://markets.businessinsider.com/news/stocks/stock-market-selloff-today-jobs-report-recession-unemployment-tech-earnings-2024-8">before the market started melting down</a>. Dismal <a target="_blank" href="https://www.businessinsider.com/amazon-stock-amzn-quarterly-earnings-call-report-live-updates-2024-7">tech earnings</a> certainly didn't help.There is a silver lining to the market's pain: Rate cuts are almost guaranteed for September. In recent days, the question has shifted from "if" to "how much," as some speculate the Fed could make a half-point cut instead of the standard quarter-point reduction.But it's not a silver bullet, and the rate cut's effect will take time to make its way through the economy. Relief will eventually be felt in the job market, but <a target="_blank" href="https://www.businessinsider.com/job-market-unemployment-outlook-fed-rate-cuts-layoffs-hiring-cuts-2024-8">it won't be immediate</a>.That means those looking for jobs, or <a target="_blank" href="https://www.businessinsider.com/hiring-slump-professional-white-collar-jobs-recession-high-salary-2024-4">stuck in ones they're unhappy with</a>, will have to wait a bit longer.<div type="image" title="Ice cube with dollar sign melts." height="900" width="1800" msid="112294396" hostid="261" sizebytes="95448"></div>In the meantime, things could get worse. Like, a lot worse.A recession indicator with an almost spotless record <a target="_blank" href="https://www.businessinsider.com/sahm-rule-recession-outlook-indicator-triggered-unemployment-rate-jobs-report-2024-8">went off on Friday</a>. The Sahm Rule is triggered when unemployment's three-month moving average moves 50 basis points above its 12-month low.Still, Claudia Sahm, the former Fed official who created the rule, told Business Insider's Madison Hoff she doesn't believe we're in a recession, but acknowledged that "things are slowing down.""It definitely should be a wake up call to policymakers," she added.The slowdown is evident across industries.Amazon warned last week about the <a target="_blank" href="https://www.businessinsider.com/amazon-worried-about-economy-bad-sign-for-consumers-inflation-jobs-2024-8">erosion of consumers' spending power</a>, previously a key factor in the economy's resiliency. McDonald's has experienced something similar, acknowledging last week that its <a target="_blank" href="https://www.businessinsider.com/mcdonalds-expensive-prices-too-high-fast-food-restaurant-falling-sales-2024-7">prices are too high</a> for some customers. And Big Tech keeps investing in AI despite <a target="_blank" href="https://www.businessinsider.com/meta-amazon-alphabet-spend-big-ai-investors-concerned-roi-2024-8">no one knowing if it will pay off</a>.The result is the economy's chances of the long-discussed soft landing <a target="_blank" href="https://www.businessinsider.com/jobs-unemployment-interest-rates-economy-recession-soft-landing-2024-8">potentially being ruined</a>.When things go bad, people tend to point fingers. And plenty of economists are looking in the Fed's direction.They feel the central bank didn't act fast enough. Central banks in Switzerland, Canada, and the UK have already started easing their policies.Remember that these are some of the same experts who have waffled on the future of the economy for more than a year, predicting everything from a full-blown recession to a Goldilocks situation.But if things do turn sour, it's a fitting bookend to what has been a difficult few years for the Fed. Its inaction in raising rates caused inflation to spike in the first place, and its hesitancy to provide relief could send us into a recession.<h3 id="77f31a4c-8462-4e3d-a71f-838cb79493fb">News brief</h3><h2 id="1fcd294b-3f53-425f-9f20-4093e8623b59">Your Monday headline catchup</h2>A quick recap of the top news from over the weekend:<ul><li><a target="_blank" rel="noopener" href="https://www.businessinsider.com/markets-japan-rate-hike-yen-fx-carry-trade-stock-futures-2024-8">Global stock markets are sliding as Japan suffers biggest fall since 1987</a>.</li><li><a target="_blank" rel="noopener" href="https://www.businessinsider.com/trump-electric-vehicles-elon-musk-endorsement-2024-8">Trump says he has 'no choice' but to support electric vehicles because Elon Musk 'endorsed me very strongly.'</a></li><li><a target="_blank" rel="noopener" href="https://www.businessinsider.com/frontier-airlines-pilot-arrested-on-board-aircraft-in-houston-2024-8">Frontier Airlines pilot arrested and escorted off aircraft by police in Houston</a>.</li><li><a target="_blank" rel="noopener" href="https://www.businessinsider.com/new-miss-usa-michigan-us-army-officer-2024-8">The new Miss USA is a US Army officer from Michigan</a>.</li><li><a target="_blank" rel="noopener" href="https://www.businessinsider.com/texas-company-headquarters-hq-tesla-chevron-charles-schwab-california-economy-2024-8">Tesla, Charles Schwab — and now Chevron. Texas is having a moment as companies leave California</a>.</li></ul><h2 id="8120060b-ae66-48dc-b149-f0489a30ffa2">3 things in markets</h2><div type="image" title="Bobby Jain" height="500" width="1000" msid="112294406" hostid="261" sizebytes="47558"></div><ol><li>Bobby Jain's hedge fund wraps its first month slightly down. The high-profile Jain Global, which started trading on July 1 with $5.3 billion, ended the month down roughly 0.65%, according to people with knowledge of the firm's results. Bigger funds like Citadel and Millennium eked out small gains. <a target="_blank" href="https://www.businessinsider.com/july-hedge-fund-performance-jain-global-citadel-millennium-2024-8">Check out how some of the Street's biggest funds did</a>.</li><li>This Gen Xer is on FIRE. Jordan Grumet felt burnt out at his job as a primary-care doctor when he discovered the "financially independent, retire early" movement. He shared the <a target="_blank" href="https://www.businessinsider.com/financial-independence-retire-early-genx-stop-working-millions-saving-2024-8">FIRE strategies he used</a> to retire at 45 and grow his savings to over $6 million.</li><li>From Wall Street to Paris. Justin Best, an investment banking analyst at Union Square Advisors, just won a gold medal in rowing at the Summer Olympics. He explained how he balanced <a target="_blank" rel="noopener" href="https://www.businessinsider.com/investment-banker-justin-best-won-olympic-gold-shares-his-secrets-2024-8">100-hour workweeks and training for the biggest games in the world</a>.</li></ol><h2 id="f4b54806-7f81-450c-ba32-92560d4fae9b">3 things in tech</h2><div type="image" title="An AI figure scanning a phone displaying an individual figure" height="2393" width="3208" msid="112294403" hostid="261" sizebytes="2232038"></div><ol><li>The Oppenheimer of AI. Michal Kosinski is a pioneer at the intersection of AI and facial recognition. But he's inheriting a troubled science that could easily be weaponized against certain groups of people. Kosinski is warning the world about the risks of his tech — <a target="_blank" href="https://www.businessinsider.com/oppenheimer-artificial-intelligence-michal-kosinski-predict-facial-recognition-2024-7">all while he's building it</a>.</li><li>Nvidia is on an acquisition spree. The firm has made <a target="_blank" href="https://www.businessinsider.com/nvidia-mergers-and-acquisition-startup-buying-spree-ftc-investigation-2024-8">four acquisition deals so far this year</a>, matching its 2020 total. But thanks in part to some regulatory scrutiny, a few of this year's deals have yet to close. Experts said while AI M&amp;A is slowing down, it's showing no signs of stopping.</li><li>Meta's AI kept impersonating a reporter — and gave his real phone number out to strangers. Rob Price kept getting added to random Spanish-language WhatsApp chats because of a quirk of Meta's AI. His investigation led to more <a target="_blank" href="https://www.businessinsider.com/meta-ai-tells-strangers-it-owns-my-phone-number-whatsapp-2024-8">questions about the "black box" nature</a> of generative AI.</li></ol><h2 id="9260fa45-d397-4b3c-b4f8-4bb193976216">3 things in business</h2><div type="image" title="A trophy surrounded by confetti labeled &quot;Most Average&quot;" height="1500" width="2000" msid="112294408" hostid="261" sizebytes="79686"></div><ol><li>Life-maxxing is making you miserable. In a world that teaches you to always be optimizing, it's hard to resist striving for perfection. But a lot of us could be happier if we quit the rat race altogether and <a target="_blank" href="https://www.businessinsider.com/consumerism-capitalism-optimization-culture-live-medium-average-good-enough-2024-8">focused on being good enough</a> rather than being the best.</li><li>Corporate America has an old people problem. Like the US government, the corporate world is dealing with a gerontocracy crisis: Aging business leaders refuse to step aside, <a target="_blank" href="https://www.businessinsider.com/joe-biden-corporate-gerontocracy-aging-ceos-retirement-succession-replacement-2024-8">putting their businesses at risk</a>. Corporate America is scrambling to figure out how CEOs can take a page out of President Joe Biden's book and step aside.</li><li>"Sweaty startups" break a sweat. These blue-collar businesses, often in unglamorous or laborious fields like septic services or pest control, used to be a moneymaking haven for entrepreneurs. Now <a target="_blank" href="https://www.businessinsider.com/sweaty-startups-hurt-by-competition-slower-spending-interest-rates-2024-8">competition is rising</a>, and some startup owners say it's getting harder to turn a profit.</li></ol><h2 id="1ad7b482-3f4b-44b4-81b6-a864aa386478">In other news</h2><ul><li><a target="_blank" rel="noopener noreferrer" href="https://www.businessinsider.com/google-netflix-openai-executives-host-kamala-harris-fundraiser-2024-8">Google, Netflix, and OpenAI execs are hosting a fundraiser for Kamala Harris</a>.</li><li><a target="_blank" href="https://www.businessinsider.com/nvidia-doj-investigation-runai-big-tech-crackdown-antitrust-acquisition-competition-2024-8">Even Nvidia can't escape the government's crackdown on Big Tech</a>.</li><li><a target="_blank" href="https://www.businessinsider.com/ravin-jesuthasan-why-companies-enforce-rto-mandates-future-of-work-2024-8">A future-of-work expert explains why some companies are willing to risk losing talent to get workers back to the office</a>.</li><li><a target="_blank" href="https://www.businessinsider.com/gen-z-favorite-work-perk-having-own-desk-to-decorate-2024-7">Assigned desks are now a work perk — and Gen Zers are making themselves right at home</a>.</li><li><a target="_blank" rel="noopener" href="https://www.businessinsider.com/several-top-news-sites-shun-openai-searchgpt-search-engine-2024-8">The New York Times and other top news sites block OpenAI's new SearchGPT web crawling bot</a>.</li></ul><h2 id="9f5d80ac-3466-429f-a50a-2ffbb70c65ff">What's happening today</h2><ul><li>Fortune 500 ranking of world's largest corporations released.</li><li>First batch of Chinese G60 Starlink satellites reportedly launches today. The endeavor is in direct competition with the US's Elon Musk-backed Starlink.</li></ul>The Insider Today team: Dan DeFrancesco, deputy editor and anchor, in New York. Jordan Parker Erb, editor, in New York. Hallam Bullock, senior editor, in London. Annie Smith, associate producer, in London. Amanda Yen, fellow, in New York.

Our bend-don't-break economy is reaching its limit

<ul class="summary-list"><li>This post originally appeared in the Insider Today newsletter.</li></ul>Welcome back! We're a little over halfway through the Olympics, but there have already been some incredible photos. <a target="_blank" href="https://www.businessinsider.com/paris-olympics-best-photos-viral-2024-8">Here are some of the best</a>.In today's big story, interest-rate cuts are almost certainly coming, <a target="_blank" href="https://www.businessinsider.com/job-market-unemployment-outlook-fed-rate-cuts-layoffs-hiring-cuts-2024-8">but the relief won't be felt immediately</a>. It begs the question: <a target="_blank" href="https://www.businessinsider.com/jobs-unemployment-interest-rates-economy-recession-soft-landing-2024-8">Are the chances of a soft landing doomed</a>?What's on deck:<ul><li>Markets: Hedge funds' July report cards are in, including an update from <a target="_blank" href="https://www.businessinsider.com/july-hedge-fund-performance-jain-global-citadel-millennium-2024-8">the new kid on the block</a>.</li><li>Tech: One man's apprehensive journey to push the <a target="_blank" href="https://www.businessinsider.com/oppenheimer-artificial-intelligence-michal-kosinski-predict-facial-recognition-2024-7">boundaries of what AI is capable of</a>.</li><li>Business: Life isn't perfect, so maybe it's time <a target="_blank" href="https://www.businessinsider.com/consumerism-capitalism-optimization-culture-live-medium-average-good-enough-2024-8">we all embrace being average</a>.</li></ul>But first, oh boy.If this was forwarded to you, <a target="_blank" href="https://www.businessinsider.com/subscription/newsletter/insider-today">sign up here.</a><h3 id="7fa5f018-5b05-4a37-a8dc-d3f89138bcb3">The big story</h3><h2 id="5fd547b9-ec52-41fc-8e08-4f4b27dd8097">Crash landing</h2><div type="image" title="Jerome Powell in front of a bar and line graph" height="1500" width="2000" msid="112293932" hostid="261" sizebytes="283498"></div>Our bend-don't-break economy might finally have reached its limit.After a year of resiliency in the face of high interest rates, the cracks are showing in the US economy.July unemployment data released Friday <a target="_blank" href="https://www.businessinsider.com/unemployment-rate-job-growth-july-labor-market-economic-data-2024-7">came in unexpectedly high</a>. The US added 61,000 fewer jobs than expected, and the unemployment rate rose to 4.3%, its highest level since October 2021.Investors were already on edge from a rise in jobless claims and weak manufacturing data on Thursday, so it wasn't long <a target="_blank" href="https://markets.businessinsider.com/news/stocks/stock-market-selloff-today-jobs-report-recession-unemployment-tech-earnings-2024-8">before the market started melting down</a>. Dismal <a target="_blank" href="https://www.businessinsider.com/amazon-stock-amzn-quarterly-earnings-call-report-live-updates-2024-7">tech earnings</a> certainly didn't help.There is a silver lining to the market's pain: Rate cuts are almost guaranteed for September. In recent days, the question has shifted from "if" to "how much," as some speculate the Fed could make a half-point cut instead of the standard quarter-point reduction.But it's not a silver bullet, and the rate cut's effect will take time to make its way through the economy. Relief will eventually be felt in the job market, but <a target="_blank" href="https://www.businessinsider.com/job-market-unemployment-outlook-fed-rate-cuts-layoffs-hiring-cuts-2024-8">it won't be immediate</a>.That means those looking for jobs, or <a target="_blank" href="https://www.businessinsider.com/hiring-slump-professional-white-collar-jobs-recession-high-salary-2024-4">stuck in ones they're unhappy with</a>, will have to wait a bit longer.<div type="image" title="Ice cube with dollar sign melts." height="900" width="1800" msid="112293929" hostid="261" sizebytes="95448"></div>In the meantime, things could get worse. Like, a lot worse.A recession indicator with an almost spotless record <a target="_blank" href="https://www.businessinsider.com/sahm-rule-recession-outlook-indicator-triggered-unemployment-rate-jobs-report-2024-8">went off on Friday</a>. The Sahm Rule is triggered when unemployment's three-month moving average moves 50 basis points above its 12-month low.Still, Claudia Sahm, the former Fed official who created the rule, told Business Insider's Madison Hoff she doesn't believe we're in a recession, but acknowledged that "things are slowing down.""It definitely should be a wake up call to policymakers," she added.The slowdown is evident across industries.Amazon warned last week about the <a target="_blank" href="https://www.businessinsider.com/amazon-worried-about-economy-bad-sign-for-consumers-inflation-jobs-2024-8">erosion of consumers' spending power</a>, previously a key factor in the economy's resiliency. McDonald's has experienced something similar, acknowledging last week that its <a target="_blank" href="https://www.businessinsider.com/mcdonalds-expensive-prices-too-high-fast-food-restaurant-falling-sales-2024-7">prices are too high</a> for some customers. And Big Tech keeps investing in AI despite <a target="_blank" href="https://www.businessinsider.com/meta-amazon-alphabet-spend-big-ai-investors-concerned-roi-2024-8">no one knowing if it will pay off</a>.The result is the economy's chances of the long-discussed soft landing <a target="_blank" href="https://www.businessinsider.com/jobs-unemployment-interest-rates-economy-recession-soft-landing-2024-8">potentially being ruined</a>.When things go bad, people tend to point fingers. And plenty of economists are looking in the Fed's direction.They feel the central bank didn't act fast enough. Central banks in Switzerland, Canada, and the UK have already started easing their policies.Remember that these are some of the same experts who have waffled on the future of the economy for more than a year, predicting everything from a full-blown recession to a Goldilocks situation.But if things do turn sour, it's a fitting bookend to what has been a difficult few years for the Fed. Its inaction in raising rates caused inflation to spike in the first place, and its hesitancy to provide relief could send us into a recession.<h3 id="77f31a4c-8462-4e3d-a71f-838cb79493fb">News brief</h3><h2 id="1fcd294b-3f53-425f-9f20-4093e8623b59">Your Monday headline catchup</h2>A quick recap of the top news from over the weekend:<ul><li><a target="_blank" rel="noopener" href="https://www.businessinsider.com/markets-japan-rate-hike-yen-fx-carry-trade-stock-futures-2024-8">Global stock markets are sliding as Japan suffers biggest fall since 1987</a>.</li><li><a target="_blank" rel="noopener" href="https://www.businessinsider.com/trump-electric-vehicles-elon-musk-endorsement-2024-8">Trump says he has 'no choice' but to support electric vehicles because Elon Musk 'endorsed me very strongly.'</a></li><li><a target="_blank" rel="noopener" href="https://www.businessinsider.com/frontier-airlines-pilot-arrested-on-board-aircraft-in-houston-2024-8">Frontier Airlines pilot arrested and escorted off aircraft by police in Houston</a>.</li><li><a target="_blank" rel="noopener" href="https://www.businessinsider.com/new-miss-usa-michigan-us-army-officer-2024-8">The new Miss USA is a US Army officer from Michigan</a>.</li><li><a target="_blank" rel="noopener" href="https://www.businessinsider.com/texas-company-headquarters-hq-tesla-chevron-charles-schwab-california-economy-2024-8">Tesla, Charles Schwab — and now Chevron. Texas is having a moment as companies leave California</a>.</li></ul><h2 id="8120060b-ae66-48dc-b149-f0489a30ffa2">3 things in markets</h2><div type="image" title="Bobby Jain" height="500" width="1000" msid="112293934" hostid="261" sizebytes="47558"></div><ol><li>Bobby Jain's hedge fund wraps its first month slightly down. The high-profile Jain Global, which started trading on July 1 with $5.3 billion, ended the month down roughly 0.65%, according to people with knowledge of the firm's results. Bigger funds like Citadel and Millennium eked out small gains. <a target="_blank" href="https://www.businessinsider.com/july-hedge-fund-performance-jain-global-citadel-millennium-2024-8">Check out how some of the Street's biggest funds did</a>.</li><li>This Gen Xer is on FIRE. Jordan Grumet felt burnt out at his job as a primary-care doctor when he discovered the "financially independent, retire early" movement. He shared the <a target="_blank" href="https://www.businessinsider.com/financial-independence-retire-early-genx-stop-working-millions-saving-2024-8">FIRE strategies he used</a> to retire at 45 and grow his savings to over $6 million.</li><li>From Wall Street to Paris. Justin Best, an investment banking analyst at Union Square Advisors, just won a gold medal in rowing at the Summer Olympics. He explained how he balanced <a target="_blank" rel="noopener" href="https://www.businessinsider.com/investment-banker-justin-best-won-olympic-gold-shares-his-secrets-2024-8">100-hour workweeks and training for the biggest games in the world</a>.</li></ol><h2 id="f4b54806-7f81-450c-ba32-92560d4fae9b">3 things in tech</h2><div type="image" title="An AI figure scanning a phone displaying an individual figure" height="2393" width="3208" msid="112293927" hostid="261" sizebytes="2232038"></div><ol><li>The Oppenheimer of AI. Michal Kosinski is a pioneer at the intersection of AI and facial recognition. But he's inheriting a troubled science that could easily be weaponized against certain groups of people. Kosinski is warning the world about the risks of his tech — <a target="_blank" href="https://www.businessinsider.com/oppenheimer-artificial-intelligence-michal-kosinski-predict-facial-recognition-2024-7">all while he's building it</a>.</li><li>Nvidia is on an acquisition spree. The firm has made <a target="_blank" href="https://www.businessinsider.com/nvidia-mergers-and-acquisition-startup-buying-spree-ftc-investigation-2024-8">four acquisition deals so far this year</a>, matching its 2020 total. But thanks in part to some regulatory scrutiny, a few of this year's deals have yet to close. Experts said while AI M&amp;A is slowing down, it's showing no signs of stopping.</li><li>Meta's AI kept impersonating a reporter — and gave his real phone number out to strangers. Rob Price kept getting added to random Spanish-language WhatsApp chats because of a quirk of Meta's AI. His investigation led to more <a target="_blank" href="https://www.businessinsider.com/meta-ai-tells-strangers-it-owns-my-phone-number-whatsapp-2024-8">questions about the "black box" nature</a> of generative AI.</li></ol><h2 id="9260fa45-d397-4b3c-b4f8-4bb193976216">3 things in business</h2><div type="image" title="A trophy surrounded by confetti labeled &quot;Most Average&quot;" height="1500" width="2000" msid="112293925" hostid="261" sizebytes="79686"></div><ol><li>Life-maxxing is making you miserable. In a world that teaches you to always be optimizing, it's hard to resist striving for perfection. But a lot of us could be happier if we quit the rat race altogether and <a target="_blank" href="https://www.businessinsider.com/consumerism-capitalism-optimization-culture-live-medium-average-good-enough-2024-8">focused on being good enough</a> rather than being the best.</li><li>Corporate America has an old people problem. Like the US government, the corporate world is dealing with a gerontocracy crisis: Aging business leaders refuse to step aside, <a target="_blank" href="https://www.businessinsider.com/joe-biden-corporate-gerontocracy-aging-ceos-retirement-succession-replacement-2024-8">putting their businesses at risk</a>. Corporate America is scrambling to figure out how CEOs can take a page out of President Joe Biden's book and step aside.</li><li>"Sweaty startups" break a sweat. These blue-collar businesses, often in unglamorous or laborious fields like septic services or pest control, used to be a moneymaking haven for entrepreneurs. Now <a target="_blank" href="https://www.businessinsider.com/sweaty-startups-hurt-by-competition-slower-spending-interest-rates-2024-8">competition is rising</a>, and some startup owners say it's getting harder to turn a profit.</li></ol><h2 id="1ad7b482-3f4b-44b4-81b6-a864aa386478">In other news</h2><ul><li><a target="_blank" rel="noopener noreferrer" href="https://www.businessinsider.com/google-netflix-openai-executives-host-kamala-harris-fundraiser-2024-8">Google, Netflix, and OpenAI execs are hosting a fundraiser for Kamala Harris</a>.</li><li><a target="_blank" href="https://www.businessinsider.com/nvidia-doj-investigation-runai-big-tech-crackdown-antitrust-acquisition-competition-2024-8">Even Nvidia can't escape the government's crackdown on Big Tech</a>.</li><li><a target="_blank" href="https://www.businessinsider.com/ravin-jesuthasan-why-companies-enforce-rto-mandates-future-of-work-2024-8">A future-of-work expert explains why some companies are willing to risk losing talent to get workers back to the office</a>.</li><li><a target="_blank" href="https://www.businessinsider.com/gen-z-favorite-work-perk-having-own-desk-to-decorate-2024-7">Assigned desks are now a work perk — and Gen Zers are making themselves right at home</a>.</li><li><a target="_blank" rel="noopener" href="https://www.businessinsider.com/several-top-news-sites-shun-openai-searchgpt-search-engine-2024-8">The New York Times and other top news sites block OpenAI's new SearchGPT web crawling bot</a>.</li></ul><h2 id="9f5d80ac-3466-429f-a50a-2ffbb70c65ff">What's happening today</h2><ul><li>Fortune 500 ranking of world's largest corporations released.</li><li>First batch of Chinese G60 Starlink satellites reportedly launches today. The endeavor is in direct competition with the US's Elon Musk-backed Starlink.</li></ul>The Insider Today team: Dan DeFrancesco, deputy editor and anchor, in New York. Jordan Parker Erb, editor, in New York. Hallam Bullock, senior editor, in London. Annie Smith, associate producer, in London. Amanda Yen, fellow, in New York.

<ul class="summary-list"><li>Earnings likely grew for the fifth consecutive quarter in Q3.</li><li>Top strategists are eyeing 2025 results ahead of what's likely a mid-single-digit advance.</li></ul>Corporate earnings are on pace for their best non-pandemic year since 2018, and market strategists expect the party to continue in the upcoming earnings season and into 2025.Interest rates and inflation have been investors' primary concerns this year, and <a target="_blank" href="https://www.businessinsider.com/labor-market-indicators-recession-warning-signs-bca-research-berezin-2024-9">worries about the labor market</a>, <a target="_blank" href="https://www.businessinsider.com/economy-jobs-report-sentiment-consumers-elections-recession-inflation-mortgage-rates-2024-9">growth</a>, and <a target="_blank" href="https://www.businessinsider.com/rates-pandemic-lows-inflation-supply-chain-geopolitical-bofa-mensah-2024-10">rising geopolitical tensions</a> have also sucked up plenty of oxygen — even though economists generally agree that a recession isn't imminent.Through all that noise, S&amp;P 500 profits have steadily risen and are set to end the year up 9.5%, <a target="_blank" class="" href="https://advantage.factset.com/hubfs/Website/Resources%20Section/Research%20Desk/Earnings%20Insight/EarningsInsight_092724.pdf">according to Factset</a>. That's the biggest jump for earnings in six years, other than 2021's robust recovery. Analysts believe 2025 will be even better, with growth of nearly 15% in the cards.<div type="image" title="2024 earnings as of Q2" height="822" width="1424" msid="113984264" hostid="261" sizebytes="55446"></div>Business Insider spoke with six investment chiefs, strategists, and money managers about the earnings and economic trends to watch in the Q3 earnings season and 2025 — plus how investors can position their portfolios for success.<h2 id="cb45912e-0004-415b-94ba-d8fc7736b77e">Q3 earnings will give clues about consumers</h2>Barring a major surprise, investors will learn starting in mid-October that earnings rose for the fifth straight quarter. Profits grew 4.6% in Q3, <a target="_blank" class="" href="https://advantage.factset.com/hubfs/Website/Resources%20Section/Research%20Desk/Earnings%20Insight/EarningsInsight_092724.pdf">according to Factset's latest projections</a>, though that would be down substantially from the 7.8% mark that analysts called for at the end of June.However, analysts have a <a target="_blank" href="https://www.chicagobooth.edu/review/why-do-analysts-low-ball-earnings-forecasts">habit of underselling earnings</a>. Nearly 79% of S&amp;P 500 firms beat Q2 estimates — partially due to a low bar, though results were quite strong at 11.2% growth.<div type="image" title="Factset beat rate Q2 2024" height="822" width="1424" msid="113984261" hostid="261" sizebytes="37156"></div>"What we've seen over the past few quarters, I really wouldn't describe as 'blowout growth' that sets up for disappointment going forward," said Mike Reynolds, Glenmede's vice president of investment strategy. Mid-single-digit to low-double-digit growth is "pretty sustainable," he added.<div type="image" title="Factset Q2 2024" height="822" width="1424" msid="113984259" hostid="261" sizebytes="29018"></div>Profit margins will be in the crosshairs since <a target="_blank" href="https://www.businessinsider.com/inflation-august-consumer-price-index-federal-reserve-rate-cuts-2024-9">inflation is slowing</a>, said Anthony Saglimbene, the chief market strategist at Ameriprise Financial. He's also keeping a close eye on signs about the strength of consumer spending, or lack thereof, <a target="_blank" href="https://www.businessinsider.com/inflation-wage-growth-investing-strategy-stocks-to-buy-goldman-sachs-2024-9">as wage growth dissipates</a>."There's been a lot of pricing power — not only in technology, but across a lot of the services and goods sides of the equation," Saglimbene said. "Can you hold profit margins in an environment where maybe your costs are becoming more stable, but demand is starting to slow?"Demand is either softening or steadfast, depending on your perspective. Joe Quinlan — who's head of markets strategy at Merrill and Private Bank, Bank of America — recently remarked that there's a strikingly wide gap between high-income households and those who aren't well off.The strategy chief recently wrote that a mere 4.4% of US households make up 15% of personal consumption, which is the <a target="_blank" href="https://fred.stlouisfed.org/series/DPCERE1Q156NBEA">backbone of GDP</a>. The rich are disproportionately driving economic growth because of the wealth effect, which means they're confident since stocks are rising. Meanwhile, Quinlan noted that <a target="_blank" href="https://news.gallup.com/poll/266807/percentage-americans-owns-stock.aspx">roughly 40% of US households don't own stocks</a>."They're the ones — the lower-income households — definitely feeling the squeeze of higher prices. I know inflation has come down when we look at the metrics, but prices for food, rent, insurance — they're still elevated," Quinlan said, adding that this is limiting disposable income.Although weakness among lower-income households is troubling, strategists don't think it will show up in corporate earnings since consumers broadly are holding up."The consumer is pretty healthy," Reynolds said. "There's maybe some warning signs on the margin on credit-card balances and delinquencies, but it's really not enough to break the camel's back on earnings."<h2 id="e9ed5200-3a27-426c-b63a-a65a628a84e6">Why earnings will thrive in 2025</h2>Although investors have only seen about half of 2024 earnings, which are on track to rise 10%, it's already time to look to 2025."As the year continues, I do think it's not about earnings for this year — it's the trajectory of earnings for next year," said Andrew Slimmon, a lead portfolio manager at Morgan Stanley Investment Management.<div type="image" title="Factset 2024 earnings" height="822" width="1424" msid="113984262" hostid="261" sizebytes="29164"></div>Corporate profits should stay strong and can potentially improve, strategists say, provided that the US economy doesn't slow too much."If the macroeconomic picture holds together, there's an expectation that we should see a bit of a re-acceleration in earnings growth," said Jim Baird, chief investment officer at Plante Moran Financial Advisors.Quinlan agrees and predicted that "earnings will reflect the dynamic and resiliency of the US economy that we just closed the quarter on."Michael Smith, the head of the growth equity team at Allspring Global Investments, said his research also indicates that companies are healthy, at least compared to a few years ago."We talk to our companies quite frequently and do our own work talking to their customers and suppliers, and we really feel like there are still some pockets of strong demand through our economy," Smith said.And even if economic growth comes in light, corporate earnings won't necessarily suffer."There's not always a one-for-one relationship between economic growth and earnings growth," Reynolds said. "You can still see earnings growth at a pretty robust level, even if economic growth moderates to some extent. So again, there's correlation there, but definitely not direct causation."Bears have <a target="_blank" href="https://www.businessinsider.com/stock-market-crash-bubble-sp500-outlook-valuations-1929-2000-hussman-2024-9">long warned that this market is overvalued</a>, but unless earnings suddenly plummet, Slimmon suggested that those fears are overstated."As long as Q3 of this year is OK, I think that's where we're going to start next year with close to $280 earnings estimates for the S&amp;P," Slimmon said. "And that is supportive of a stock market that trades kind of closer to 6,000."Analysts' estimates may be ambitious, Saglimbene said. He suspects that Q4 expectations will recede alongside projections for Q1 and Q2 of 2025, though that often happens before quarters."That could be a little bit of a headwind for the market," Saglimbene said. "But again, if we're growing and profits are growing year-over-year, I think the market will look past some of that."Saglimbene later added: "We might not grow by 15% next year in an environment where the economy's growing 2%, but we might grow 7% or 8%. That's a normal earnings growth kind of environment, and I think that's enough to continue to push the market higher."<h2 id="06369d93-53a3-422f-8a02-436b2da92292">3 top places to invest heading into Q3 earnings</h2>When asked which parts of the market look most attractive, strategists consistently identified three sectors: communication services, healthcare, and technology.Large-cap growth stocks have carried the market higher for years thanks to their supercharged earnings. But that has changed in recent months, Saglimbene noted.The strategy chief expects to see broader profit growth, especially in economically sensitive sectors like consumer discretionary, financials, industrials, materials, and real estate. They may also have more upside since they're cheaper."The areas that have not seen the best profit growth, like cyclicals outside of technology, their profit growth trends could actually improve more than expected because the economy is not headed for recession, because growth is remaining positive, because consumers are still spending," Saglimbene said.Smith agrees that industrials and consumer-focused sectors are worth a look, as are tech and healthcare companies. His investing strategy is centered around finding growth stocks on the so-called "right side of change" that also happen to be discounted. He said he's found more opportunities in small- and <a target="_blank" href="https://www.businessinsider.com/stocks-to-buy-2025-mid-caps-investing-outlook-goldman-sachs-2024-9">mid-sized stocks</a> lately."Money has to find a home somewhere, and it tends to flow to where it gets treated the best," Smith said. "Right now, the relative opportunity is down-cap."

Here's how to invest in the Q3 earnings season as profits re-accelerate despite misplaced recession myths

<keyword id="20253141" type="General" weightage="20" keywordseo="Bharti-Global" source="keywords" meta.keywordsubtype="org" meta.entityname="Bharti Global" meta.hostid="268" meta.entityid="Bharti Global">Bharti Global</keyword>, the international <keyword id="19895437" type="General" weightage="20" keywordseo="investment" source="keywords">investment</keyword> arm of Bharti Enterprises, will acquire about 24.5 per cent stake in <keyword id="20115879" type="General" weightage="20" keywordseo="BT-Group" source="keywords" meta.keywordsubtype="org" meta.entityname="BT Group" meta.hostid="268" meta.entityid="BT Group">BT Group</keyword>, Britain's largest broadband and mobile company, from <keyword id="22756191" type="General" weightage="20" keywordseo="Altice-UK" source="keywords" meta.keywordsubtype="org" meta.entityname="Altice UK" meta.hostid="268" meta.entityid="Altice UK">Altice UK</keyword>, a release said on Monday. Although it did not divulge the size of the deal, market watchers say that at BT's valuation of roughly USD 15 billion dollars, the deal could be in the ballpark of USD 4 billion. The shares will be purchased through Bharti Televentures UK, which is wholly-owned by Bharti Global. Bharti Televentures UK has inked an agreement with Altice UK to acquire about 9.99 per cent stake of BT Group's issued capital imminently with the rest about 14.51 per cent of BT's share capital is to be acquired post regulatory clearances. Telecom billionaire Patrick Drahi's Altice UK, the largest shareholder in BT, has been struggling with high debt. "Bharti Global, the international investment arm of Bharti Enterprises, a leading Indian business group with world-class companies in telecoms, digital infrastructure and space communications, has reached an agreement to acquire an interest in 24.5 per cent of the issued share capital of BT Group plc from Altice UK," Bharti said in a release. Bharti hopes the investment will further help create new synergies in the telecom sector between India and UK in the areas of AI and <keyword id="19916120" type="General" weightage="20" keywordseo="5G" source="keywords">5G</keyword> R&amp;D and core engineering among others, "offering great potential to collaborate on industry best practices and emerging technologies". It is pertinent to mention here that Bharti and BT have a relationship going back more than two decades. In 1997, BT acquired a 21 per cent stake in Bharti Airtel, and hence Bharti's latest move to acquire a 24.5 per cent chunk in the iconic British company marks a defining moment for the Indian telecom conglomerate. Sunil Bharti Mittal, Chairman of Bharti Enterprises said: "Bharti and British Telecom (BT) have an enduring relationship going back more than two decades wherein BT owned 21 per cent stake along with two board seats in Bharti Airtel Limited from 1997-2001. Today marks a significant milestone in Bharti Group's history as we invest in BT - an iconic British company". Bharti's investment in BT aims to support the commitment of Prime Minister Narendra Modi towards his vision in elevating and broadening the India-UK ties, the release said. It noted that during the recently concluded visit of UK Foreign Secretary, David Lammy to India, the UK-India Technology Security Initiative was announced to expand collaboration in critical and emerging technologies across priority sectors including telecom. Sunil Mittal said: "This investment in BT aims to support the commitment of our Prime Minister towards his vision in elevating and broadening the India-UK ties. Bharti's own record of owning and operating telecom and broadband networks around the world is underpinned by placing customers, digital innovation and operational efficiency at the heart of its business". Shravin Bharti Mittal, Managing Director of Bharti Global said: "We review global investment opportunities in the world of technology from digital infrastructure to software. BT is well known to us from the long association with Bharti, so we are pleased to have this opportunity to acquire a significant stake in the company." Bharti believes that BT is poised for leadership in the telecom arena, especially home broadband services, he added. Meanwhile, BT Group, in a separate statement said the investment from Bharti is a strong vote of confidence in the future of the British telecom carrier and its strategy. Allison Kirkby, Chief Executive of BT said: "We welcome investors who recognise the long-term value of our business, and this scale of investment from Bharti Global is a great vote of confidence in the future of BT Group and our strategy". "BT has enjoyed a long association with Bharti Enterprises, and I'm pleased that they share our ambition and vision for the future of our business. They have a strong track record of success in the sector, and I look forward to ongoing and positive engagement with them in the months and years to come," Kirkby said. Barclays Bank PLC, acting through its Investment Bank served as the sole financial advisor and Linklaters LLP served as legal advisor to Bharti Global in connection with the transaction. 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Bharti to acquire about 24.5% stake in BT Group from Altice UK; deal estimated at $4 bn

<ul><li><keyword id="859162" type="General" weightage="20" keywordseo="kotak-investment-advisors" source="Orion">Kotak Investment Advisors</keyword> announced the launch of <keyword id="14619266" type="General" weightage="20" keywordseo="kotak-india-alternative-allocation-fund" source="Orion">Kotak India Alternative Allocation Fund</keyword>.</li><li>It is a <keyword id="647801" type="General" weightage="20" keywordseo="fund-of-funds" source="Orion">fund of funds</keyword> to invest in other <keyword id="34499" type="General" weightage="20" keywordseo="private-equity" source="Orion">private equity</keyword> and <keyword id="6357097" type="General" weightage="20" keywordseo="venture-capital" source="Orion">venture capital</keyword> funds besides direct investments in companies.</li><li>The company aims to diversify its investment across different investment avenues in multiple sectors.</li></ul>Kotak Investment Advisors Ltd (KIAL) on Tuesday announced the launch of Kotak India Alternate Allocation Fund, a fund of funds (FoF) to invest in other private equity (PE) and venture capital (VC) funds, besides directly investing in companies. The fund targets to raise ₹1,500 crore, including a greenshoe option of ₹750 crore. The objective of the new fund of funds is to diversify across different investment avenues in multiple sectors, including consumer, technology, healthcare, financials and more. It also intends to invest some portion into co-investment opportunities available from such investee funds. “Indian alternate ecosystem has become vibrant with PE/VC fund managers delivering consistent returns and outperformance over public benchmarks. But many of the marquee fund managers have been inaccessible to domestic investors as they raised only offshore capital or had high minimum ticket investment requirements,” said Srini Sriniwasan, managing director of Kotak Investment Advisors. He added that Kotak Investment Advisors intended to enable access to such funds and increase domestic overall participation in the Indian alternates industry. “Lack of knowledge and information availability in this asset class makes it difficult to make an informed choice. Diversification of risk across managers is tough due to high minimum investment requirements. Through Kotak’s fund of funds we intend to provide investors access to multiple funds as well as leverage our institutional diligence,” Nidhi Chawla, fund manager at Kotak India Alternate Allocation Fund added. SEE ALSO <a href="https://www.businessinsider.in/finance/news/the-worst-of-the-rupees-decline-might-be-over-as-market-expects-us-fed-to-dial-down-pace-of-hikes/articleshow/93290895.cms">The worst of the rupee's decline might be over as market expects US Fed to dial down pace of hikes</a> <a class="tout-title-link" href="https://www.businessinsider.in/stock-market/news/markets-on-a-wait-and-watch-mode-as-they-await-cues-from-rbi/articleshow/93290015.cms">Markets on a wait and watch mode as they await cues from RBI</a> <a href="https://www.businessinsider.in/business/auto/news/as-new-cars-get-pricier-pre-owned-bmws-audis-and-porsches-get-more-attractive/articleshow/93275786.cms">As new cars get pricier, pre-owned BMWs, Audis and Porsches get more attractive</a>

Kotak Investment Advisors intends to raise ₹1,500 crore to increase its investments in consumer, technology company

<ul><li>LTCG of up to Rs 1,20,000 in a single financial year is tax-free. </li><li>Effective July 23rd, 2024, <keyword id="21006654" type="General" weightage="100" keywordseo="indexation-benefits" source="keywords">indexation benefits</keyword> will no longer be available for real estate, gold</li><li>Effective July 23rd, LTCG will be charges at 12.5%, sans indexation benefit</li></ul> After FM <keyword id="19916618" type="General" weightage="20" keywordseo="nirmala-sitharaman" source="keywords">Nirmala Sitharaman</keyword> proposed to remove indexation benefits on <keyword id="20584761" type="General" weightage="20" keywordseo="long-term-capital-gains" source="keywords">long-term capital gains</keyword> (LTCG) on real estate, gold, and other unlisted assets, discussions were abuzz on the internet as to how this would lead to significantly higher <keyword id="20118944" type="General" weightage="20" keywordseo="taxation" source="keywords">taxation</keyword> on gains from <keyword id="20008581" type="General" weightage="20" keywordseo="property-sales" source="keywords">property sales</keyword>. Previously, LTCG on long-term capital gains was marked at 20%, but it came with indexation benefits, which eventually lowered the individual's overall <keyword id="19974193" type="General" weightage="20" keywordseo="tax-liability" source="keywords">tax liability</keyword>. Now, it has been lowered to 12.5%, but minus any indexation benefit. So, with indexation gone, how will gains from property sales be taxed going ahead? Is this applicable to all properties? What is set to change? Does it help that the <keyword id="22480102" type="General" weightage="20" keywordseo="LTCG-tax" source="keywords">LTCG tax</keyword> has been brought down from 20% to 12.5%? Lets take a deep-dive First, explain this long term short-term conundrum to me So, how much capital gains tax you're supposed to pay depends on how long you hold a particular asset before selling it. Prior to yesterday's announcement, there were 3 holding periods which determined whether an asset was held for long-term or short-term: The situation before- <ul><li>Shares, units of mutual funds would qualify for LTCG tax, if they are held for more than 12 months. If the holding period is less than 1 year, you'd have to pay short-term capital gains (STCG).</li><li>Real estate and immovable property would qualify for LTCG tax, if held for more than 24 months (2 years), along with indexation benefit. </li><li>Bonds, debentures and gold were to be considered long-term capital assets, if they were held for more than 36 months (3 years), with indexation benefit. </li></ul>But going ahead, there will only be two waiting periods which will determine whether an asset would be classified as long-term or short-term The situation now- <ul><li>For all listed securities (stocks, mutual fund units), the holding period for LTCG tax purposes would be more than 1 year (sans indexation benefits) All other assets (real estate, gold, bond, debentures) will qualify for LTCG tax, if they are held for more than 24 months (minus indexation benefits). </li></ul>What was the taxation situation earlier on long-term capital gains? What has changed? So, lets say Tara purchased a property in FY 2004-05 for Rs 20,00,000. In FY 2024-25, she decided to sell it for Rs 60,00,000. You'd think she'll have to pay a flat 20% on Rs 40,00,000, which was her total profit earned from selling her property (Rs 60,00,000-20,00,000). But this is where indexation swooped in and helped cushion the overall tax liability. Prior to July 23rd, 2024, the government considered something known as "indexed cost of acquisition" for determining an individuals' total LTCG tax liability, which was calculated using the following formula: [Cost Inflation Index (CII)value for transfer/sale year/CII for purchase year, or 2001-02 (whichever is later) X cost of acquisition]. Thankfully, you don't have to go about calculating this CII value, since the government does this for you, and notifies the same officially. What CII essentially does is that it compares the current prices of basket A(which contains a bunch of products and services) to the price of the same basket A in the year of comparison, to reflect the change in prices caused by inflation. So, for Tara, her indexed cost of acquisition would come down to Rs 64,24,778 [363(CII for 2024-25) /113(CII for 2004-05)X 20,00,000]. This would mean she incurred a capital loss of Rs 4,24,778, since her indexed cost of acquisition is more than her sales receipts. So, she does not need to pay any LTCG tax. She can set off this loss, but only against her other long term gains with a limit of Rs 2 lakh in one financial year, and can carry forward the same for a maximum of 8 years. However, this changed when the budget memorandum noted yesterday, "indexation available under the second proviso to section 48 is proposed to be removed for calculation of any long-term capital gains which is presently available for property, gold, and other unlisted assets. This will ease the computation of capital gains for the taxpayer and the tax administration". This means that indexation benefits on LTCG will be applicable starting July 23rd, 2024. To understand its impact, assume that this rule is in effect from April 1, 2024. In that case, Tara's LTCG will be a flat 12.5% of her total gains of Rs 38,75,000 (remember, Rs 1,25,000 per year on LTCG are tax-exempt). This would bring Tara's taxability to Rs 4,84,375 Long story, short, minus the indexation benefit, Tara will have to pay Rs 4,84,375 as long-term capital gains tax. However, there has been a slight increase in the basic tax exemption limit for LTCG. Previously, LTCG of up to Rs 1,00,000 in a single financial year was tax-free. But now, this threshold has been raised to Rs 1,25,000. Small wins! <div type="Article" hostid="261" msid="111956035" title="Decoding capital gains taxes: What FM Nirmala took from your pocket, what she gave you in Budget 2024" mstype="2" mssubtype="0"></div> Okay, is there something that continues to be the same for long-term capital gains? Yes, roll-over benefits continue without change. This means you can re-invest the proceeds from sale of your old property into buying a new, residential one, in order to avoid capital gains tax. But that too, is not without its share of catches: You can reinvest these funds in either 54EC bonds, which have a maximum annual investment limit of Rs 50,00,000. Or, you can avail this exemption for a maximum of 2 residential houses, provided your capital gains are limited to Rs 2 crore. Also, if you've it purchased a property, or held from before 2001, you can continue to avail indexation benefits, thanks to something called a grandfathering clause. Does indexation or lower tax rates work better? There's no general rule here. But a cursory look indicates that high capital gains would be favorably taxed under these reduced tax rates, while lower returns and holding periods would find indexation to be a better option. Says Pankaj Kumar, VP – Fundamental Research, Kotak Securities, "the Union Budget-FY25 has rationalized long-term capital gains tax on real estate transaction. It proposed to remove indexation benefits and reduce the long term capital gains tax rate from 20% to 12.5% with immediate effect (grandfathering for properties held before 2001). We find that the new capital gains tax structure for real estate favours investors, who have generated high IRRs, while investors with poor IRRs would be worse off in the new regime". "On the other hand, it is expected to have limited impact on end users who purchase homes for personal consumption. The budget has also talked about encouraging states to lower the stamp duty and consider lower duties for women buyers. Lowering of stamp duties would reduce the overall acquisition cost in high stamp duty states/markets like Gurgaon, Chennai, Mumbai and Kolkata", continued Kumar.

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