It was a rollercoaster ride on the Dalal Street – one that ended on a sour note. The Sensex lost over 200 points in what was a very volatile session. The Nifty lost about 60 points to break below the 8,300 mark. Midcaps also fell in tandem with the bluechips as a late sell-off caught the bulls off guard.
A relative outperformer in the past few days, the rupee also hit a multi-month low today, sliding to 62.25 against the dollar.
In an interview to CNBC-TV18, Dipan Mehta, Member BSE & NSE, Sudarshan Sukhani, s2analytics.com, Jai Bala, Cashthechaos.com and Pankaj Murarka of Axis Asset Management shared their reading and outlook on the equity market, rupee, Brent and cherry-picked stocks across various sectors.
Mehta says that Indian equity market is at a fair level and market participants can look into buying good quality stocks on dips. He is bullish on banks given the hopes of interest rate cut especially private sector lenders with good track record. He recommends long-term investors to avoid buying ONGC.
However, technical analyst Sudarshan Sukhani, s2analytics.com is of the view that market trend for the short-term is down and hence once should avoid buying largecap stocks. But those looking to bet on specific sectors can venture into IT stocks like TCS , Infosys , HCL Tech and Tech Mahindra .
Meanwhile, Murarka is not reading too much into the current market correction, he feels that the market remains in a bull run and the fall is due to profit-booking. He is upbeat on IT and domestic cyclicals like autos and financials.
Sharing view on the Indian rupee, Bala said that Indian rupee will break its all time low level may be in the last part of 2015 or in the early part of 2016. He sees Brent heading to around USD70/bbl in the short to medium-term.
Below is the excerpt of the interview. For the complete discussion watch the accompanying videos
Anuj: What would be in your shopping list from a slightly medium to longer-term perspective?
Sukhani: That is well qualified because I do not have a shopping list for a short-term. I have already explained that the short-term trend is down and there is nothing and we shouldn’t be venturing to buy at least not the largecap and not the heavy weights.
For a short-term and medium-term both IT is the best pride to begin a rally. We have already seen a sharp correction in IT stocks while banks haven’t done that. I do not see the banks actually moving up the private sector banks until they have gone through some kind of well sobering influence so as to say. So, Tata Consultancy Services (TCS), HCL Tech as well as Tech Mahindra and Infosys all four are buying candidates. Not necessarily today but in the next few days that is where the focus should be.
Anuj: For how long do you think ITC can keep taking leadership positions because in the phase of a weak market this is one stock which is contributing nearly 60-70 points to the Nifty over this month?
Sukhani: The answer is not for long. This is part of a normal index management and we understand why it happens but that is about it. It is not because ITC has stunning charts or a very appropriate momentum that it is going up. It is going up for different reasons that can not last for long.
Much more important is will the other stocks than rally to compensate for ITC gains we don’t now. However, at this point the trend is down and I don’t think we should think about buying that is much easier answer to give.
Senthil: Would you buy IDFC ?
Sukhani: I would be a buyer in IDFC but not necessarily when this down trend is persisting. For a long-term investor all this 300-400 points is immaterial. You can buy any blue chip you want.