Time To Invest In Quality Stocks With Strong Biz Models: SBI Report

Mumbai: As global economic uncertainties rise due to US trade tariff tensions, inflation risks and volatile markets, a new report said on Monday recommended investing in quality businesses for long-term gains.

“Investors should focus on companies that have strong business models, clear earnings growth potential, and steady cashflows, especially during times of heightened macroeconomic instability,” according to the report by SBI Funds Management.

The report highlights that global financial markets have been shaken by the return of aggressive US trade policies under Trump 2.0, including steep tariff hikes. India has also been affected, with reciprocal tariffs of up to 27 per cent imposed on various sectors. The risk of stagflation -- a mix of high inflation and slow growth -- also looms large, especially if the US economy slows down due to rising prices and reduced consumer sentiment. Despite these challenges, the report notes some positive shifts in India’s market environment. The correction in equity prices and falling bond yields have brought market valuations closer to historical averages.