Investors expect Indian markets to continue rising though not at the same pace


Indian indices rose in the Mahurat trading session on Sunday in-line with most such sessions in the past, helped also by positive global cues. After a great year for broader equity markets, investors are looking forward to markets continuing rising though not at the same pace, said Dhiraj Relli, MD & CEO, HDFC Securities.

“They remain a bit apprehensive of the key risks including outcome of elections, inflation and interest rate trajectory and geopolitical events induced negatives. However, equities remain a preferred choice for investors given the favourable macros and micros and the benevolent view of global institutions/brokerages towards Indian markets,” he said.

“Having said, investors need to conduct asset allocation review, portfolio review at regular intervals, and raise the quality of stocks held in their portfolio,” he added.

BSE Sensex began Samvat 2080 on a positive note with the index climbing 354 points beyond the 65 K mark in the Muhurat trading session on Sunday. The Sensex ended the special one-hour session up 355 points at 65,259 points.

Infosys led the Sensex gains up 1.4 per cent followed by Wipro, Asian Paints, TCS, and NTPC. The BSE Small Cap index gained 1.14 per cent while the BSE IPO Index was up more than 2 per cent.

Motilal Oswal, Group MD & CEO, Motilal Oswal Financial Services said Hindu Samvat 2080 is likely to start on a positive note on the back strong earnings and healthy economic outlook. Samvat 2079 ended with Nifty gaining around 10 per cent, despite economic headwinds and global geopolitical concerns.

“Entering into Samvat 2080, we believe India would continue to shine and expect markets to maintain its outperformance. We believe that over the next couple of quarters, sector rotation would be an important driver along with the overall market uptrend. We expect sectors like BFSI, Discretionary Consumption, Construction & Real Estate and High Growth Niche Sectors to drive the overall market uptrend,” he said.

Sunil Shah, director at Khambatta Securities added: “Indian equities are expected to outperform most other global markets in the face of continued geopolitical uncertainties and relatively higher domestic economic growth. The major themes will be domestic consumption and premiumisation, enabling companies to post strong earnings growth aided by margin accretion. 

“Infra and construction plays are expected to do well as the government’s thrust on infrastructure development is seen to continue, while higher budgetary allocation in rural-focus schemes can help drive a recovery in rural consumption, especially with the upcoming budget being the last one before the general elections.

“In spite of rich valuations in the small- and mid-cap segments, companies with fundamentally strong businesses and good earnings growth continue to justify their valuation. If US bond yields start coming down by the second half of CY2024, FPIs will come back to the party. Upcoming state and general elections can make the market move sideways. Inflation, interest rate trajectory, and geopolitical tensions will remain the key risks.”

Reflecting the mixed global sentiments on account of a more than expected fall in Chinese exports, highlighting a continued slowdown in global trade, the Indian market is mired to a range bound trend, says Vinod Nair, Head of Research at Geojit Financial Services.

The Nifty index was not able to breach above the key level of 19,500. Though cues from the Fed Chair’s speech have reduced the likelihood of a rate hike in the near term, leading to an ease in US treasury yields and calming the market, he said.

However, headline inflation remains above the US central bank’s target. FIIs selling has moderated but inflows continue to be muted on concerns of an elevated interest rate and a global slowdown, he said.

Mid and small caps are back in favour after the recent fall, led by retail activities and good corporate results. The focus will be on inflation data US and India, India’s October inflation is expected to ease to 4.8 from 5 per cent, while US inflation is expected to remain steady.

Related posts