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Nifty to hit 9000 before next Union Budget

The Nifty is likely to touch 9,000 before finance minister Arun Jaitley presents his next Union Budget, foresees CNBC-TV18’s Udayan Mukherjee. The Nifty scaled psychological 8,000 level on Monday after consolidating in the past few sessions.

On the global front, liquidity continues to be strong and volatility is low. Good news from the European Central Bank (ECB) in terms of rates can cheer global markets, he says. However, one needs to keep an eye on the geopolitical situation, which can blindside and emerge as a risk, he cautions. Further, he adds that chances of a massive decline in global markets due to slew of expected rate hikes by global central banks is low.

Market participants who have well constructed portfolios, comprising of pharma and auto stocks shouldn’t take profits, he recommends. Also, one should stick to sectors like banks, auto ancillaries and select infrastructure stocks, he adds. “Stocks like  Sun Pharma and  Maruti have done well in the past few sessions. Consumer names are also coming back in flavour,” he adds. On the flipside, one should avoid stocks in the metals and mining sector which are likely to be impacted by the coal scam.

Also Read: Nifty to hit 10,000 by next Budget, says Raamdeo Agrawal

Mukherjee, who has also been closely tracking midcap stocks, says those wanting to make money from this space should follow an investment approach rather than a trading one. “Don’t get out of high quality midcaps now. Don’t trade them frequently and hold them for better profits,” he adds. 

Continuing his bullish tone on midcaps, he says midcap story would continue for the next three to four years and the midcap index may hit 20,000 level from 11,000 currently in the next two or two-and-half years. “Over the last one year, the midcap index has left the Nifty long way behind. What you want to map right now is not what midcaps are doing relative to their old highs, but for new investors what is the incremental return that they are getting from midcaps,” he says.

For the complete analysis watch the accompanying videos.

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