Stock Market Today: The Benchmark indices Nifty-50 index and Sensex are trading near highs, they scaled in Monday. The markets are factoring policy continuity, with Bhartiya Janta Party led National Democratic alliance regaining power in the ongoing general elections . Nevertheless Volatility index or Nifty VIX is at close to 24 and has risen sharply from 10-14 range in April. It is likely rise further as we move close to the election result dates.
Manish Sonthalia, Chief Investment Officer of Emkay Investment Managers says that market is factoring around 330 seats for the ruling party and any negative surprise can lead to correction in markets while positive surprises can lead to rally in the markets.
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However Emkay for now has maintained Nifty December 2024 target at 24,500 and also expects Nifty Earnings growth to be at 15%-16%.This means that Nifty can scale 26,500 in next 18 months.
Among sectors, Banking and Financial Services has seen valuations correction in valuations, while the Public sector undertakings and industrials remain Sonthalia’s picks. Investment-related themes will come into play in the Power sectors while there is re-rating in public sector units as some of the government entities will have an advantage in sectors such as defence, oil marketing companies and power financers bottom out, as per Sonthalia. Industrial Infrastructure and Power are some other sectors that remain favorites of Sonthalia.
Even in case of a correction taking place, stocks with strong fundamentals can be accumulated by investors, say experts.
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“High quality large caps can be the preferred bets. Sectors like financials, automobiles, capital goods, telecom and real estate are ideal for investment”, said Dr V K Vijayakumar, Chief Investment Strategist, Geojit Financial Services* Investors should remain invested and those who are optimistic about political stability can buy ahead of election results.
Some of the sectors to focus on include those that have been beneficiary of Production linked incentive schemes or the PLI, that can be considered by investors expecting policy continuity.
Stocks in Sectors as Large Scale Electronics Manufacturing, Automobiles & Auto Components , High-Efficiency Solar PV Modules, Advance Chemistry Cell (ACC) Battery, Electronic/Technology Products are some sectors that can be considered by investors as investment bets.
“We are expecting renewable energy, space technology, artificial intelligence, electric vehicles, semiconductor and chip manufacturing apart from traditional infrastructure like railways and highways to do well” said Feroze Azeez, Deputy CEO, Anand Rathi Wealth
Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint. We advise investors to check with certified experts before taking any investment decisions
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Published: 29 May 2024, 02:46 PM IST