By: Dr K C Gupta

CONTRARIAN INDICATORS

AAII Bull-Bear Spread +10.5% (above average)
CNN Fear & Greed Index 53 (neutral)
NYSE %Above 50-dMA 73.61% (overbought)
SP500 %Above 50-dMA 67.40% (positive)

ICI Fund Allocations (Cumulative), 11/30/25
OEFs & ETFs: Stocks 61.55%, Hybrids 4.05%, Bonds 17.36%, M-Mkt 17.04%

INTEREST RATES

CME FedWatch
Cycle peak 5.25-5.50%
Current 3.50-3.75%
FOMC 1/28/26+ hold
FOMC 3/18/26+ hold

Treasury

T-Bills 3-mo yield 3.70%, 1-yr 3.53%; T-Notes 2-yr 3.60%, 5-yr 3.84%, 10-yr 4.24%; T-Bonds 30-yr 4.82%;
TIPS/Real yields 5-yr 1.38%, 10-yr 1.92%, 30-yr 2.56%
FRNs Index 3.623%

Bank Rates
www.depositaccounts.com/


Stable-Value (SV) Rates, 1/1/26
TIAA Traditional Annuity (Accumulation) Rates
Restricted RC 5.00%, RA 4.75%
Flexible RCP 4.25%, SRA 4.00%, IRA-101110+ 3.50%
TSP G Fund 4.250% (previous 4.125%)

India Fear & Greed MMI 10.00 (extreme fear)
Weekly ETFs: INDA -3.05%, INDY -2.65%, EPI -3.04%, INDH -1.92%, SPY -0.35%

The data above are as of Sunday preceding the publication date.

ECONOMY

German Allianz & (Reliance) Jio Financial Services (JFSL) have formed three 50-50 joint-ventures (JVs) for general insurance, life insurance & reinsurance. These JVs will offer digital interfaces & predictive data analytics (AI) to improve insurance experience. Some existing Allianz operations in India will be consolidated under these JVs.
Reliance Industries (Mukesh Ambani) has developed the “Jio” brand (jio means to live in Hindi) for several current or former (but spun off) operations – Jio Platforms (JPL; e-commerce holding company), Jio Financial Services (JFSL), Jio Infocomm (telecom), JioStar (media), etc.
Other multinational insurers in India include AIG (US), AXA (France), General Re (US), Lloyd’s of London (UK), MetLife (US), Munich Re (Germany), Nippon Life (Japan), Prudential (UK), Sun Life (Canada), Swiss Re (Switzerland), Zurich (Switzerland), etc.

World Bank regional classifications moved Pakistan out of South Asia (new SA – India, Bangladesh, Nepal, Sri Lanka) & into Middle East, North Africa, Afghanistan & Pakistan (new MENAAP). These classifications are based on multiple considerations of geography, economics & cross-border activities. In some respects, Pakistan was #2 within the old-SA, but will be #1 in the new MENAAP.

SPECIAL TOPIC – INDIAN TRADE DEALS

US President TRUMP isn’t happy with the progress of US-India trade negotiations & has threatened to raise tariffs on India even higher than the current 50% (base 25% + penalty 25%). There is also a bill moving though US Congress that will impose up to 500% tariffs & secondary sanctions on countries that aren’t aligned with US foreign policies – called Donroe Doctrine by media after the old Monroe Doctrine.

Additional Iran related tariffs have also been floated. India shouldn’t be affected by Greenland related tariffs (now withdrawn).

Ignore the noise that US-India trade deal was almost done in 2025 pending only PM MODI’s phone call to Trump. It was a one-sided term-sheet put out by US that India couldn’t possibly accept. The leaders of countries don’t talk to finalize deals until their teams have reached agreement on 99% of issues. Subsequently, a quick-staircase trade deal approach was mentioned by the US Commerce Secretary LUTNICK. So, there may have been a missed opportunity when US was looking for countries to announce deals in 2025, but India took the path of slow-walking, stalling & challenging US on some other trade issues at WTO that were easily stonewalled.

The US Supremes have yet to rule on legality of tariffs under emergency orders.

High tariffs on India & restrictions & high fees for H-1B visas have had the unintended effect of many US companies (Alphabet, Amazon, Meta, Microsoft, etc) continuing to invest in India through direct investments, joint-ventures & GCCs (global capability centers). Indian global exports are also rising. The exports to US haven’t collapsed although several Indian industries have been hurt. But there wasn’t any big shock to Indian economy, markets or exports.

India has taken steps such as tax reforms, relaxing rules for foreign investments, monetary easing (by RBI) & adjusting the RBI balance sheet. India has also been rushing trade deals with other countries in reaction to the US-India trade deal being in limbo & high US tariffs.

Trade deals done in 2025: United Kingdom (CETA), Oman (CEPA), New Zealand (FTA), the EFTA bloc (Switzerland, Norway, Iceland, Liechtenstein; TEPA signed in 2024, effective in 2025)

Trade deals pending in 2026: Chile, EU (01/27/2026; “mother of all deals”), Eurasian Economic Union (EAEU – Russia, Belarus, Kazakhstan, Armenia, and Kyrgyzstan), Kyrgyzstan, Mercosur trade bloc (South America – Argentina, Bolivia, Brazil, Paraguay, Uruguay, etc), Mexico, US

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