More focussed on earnings right now than US Fed rate cuts: Niles Investment
Dan Niles, Founder and Portfolio Manager at Niles Investment Management, says US stocks are priced to perfection but signs of some fundamental issues are starting to crop up.
Dan Niles, Founder and Portfolio Manager at Niles Investment Management, believes US stocks are currently priced to perfection but there are concerns with respect to earnings.
Niles pointed out that last week some prominent software companies that were all supposed to benefit from artificial intelligence (AI) such as Salesforce, Workday, Snowflake, etc. cut forecasts,, leading to their stocks getting clobbered.
"So the question has to be, is this sort of a harbinger of weaker earnings these companies are going to start to report in June? And do we end up with more rate cuts than we're expecting, but for the wrong reasons," he said.
He questioned if these cuts in the earnings forecast are potential indicators of broader economic weakness following significant rate hikes. “....there are some signs that there are some fundamental issues starting to crop up,” he added .
Also Read: These three factors will decide if the US Fed will cut rates in September: ING
Niles prefers India over China in the long term, stating that many companies are shifting their manufacturing operations from China to India.
He highlighted India's skilled workforce, improving infrastructure, and growing population, compared to China's first population decline in 60 years.
While short-term developments might vary, India's long-term prospects make it a more attractive option than China, he noted.
Also Read: The Power of Insights: Artificial intelligence and the data-driven revolution
For more details, watch the accompanying video
Catch all the latest updates from the stock market here
Niles pointed out that last week some prominent software companies that were all supposed to benefit from artificial intelligence (AI) such as Salesforce, Workday, Snowflake, etc. cut forecasts,, leading to their stocks getting clobbered.
"So the question has to be, is this sort of a harbinger of weaker earnings these companies are going to start to report in June? And do we end up with more rate cuts than we're expecting, but for the wrong reasons," he said.
He questioned if these cuts in the earnings forecast are potential indicators of broader economic weakness following significant rate hikes. “....there are some signs that there are some fundamental issues starting to crop up,” he added .
Also Read: These three factors will decide if the US Fed will cut rates in September: ING
Niles prefers India over China in the long term, stating that many companies are shifting their manufacturing operations from China to India.
He highlighted India's skilled workforce, improving infrastructure, and growing population, compared to China's first population decline in 60 years.
While short-term developments might vary, India's long-term prospects make it a more attractive option than China, he noted.
Also Read: The Power of Insights: Artificial intelligence and the data-driven revolution
For more details, watch the accompanying video
Catch all the latest updates from the stock market here
(Edited by : Shweta Mungre)
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