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Market headed lower; see downgrades in IT: Ambit’s Holland

Holland says the easy money has already been made and investors should brace for some tough months ahead. He sees little scope for an expansion in the forward price to earning multiple of the Indian market beyond 17, and does not expect the Nifty to top 9000 anytime soon.

Indian equities are headed lower near term because of the nervousness in global markets as well subdued corporate earnings growth, says Andrew Holland, CEO, Ambit Investment Advisors.

In an interview with CNBC-TV18, Holland says he expects global equities to correct 5-10 percent in the short term and sees upheaval in currency markets because of the conflicting monetary policies being followed by central banks of the major economies.

He says the easy money has already been made and investors should brace for some tough months ahead. He sees little scope for an expansion in the forward price to earning multiple of the Indian market beyond 17, and does not expect the Nifty to top 9000 anytime soon.

Holland is bearish on IT, saying valuations are expensive. He expects earnings downgrades in the sector, and sees pharma as emerging as the preferred defensive play.

He is bullish on financial services firms and expects the RBI to cut interest rates by another 50 basis points by June this year.

VIDEO AND INTERVIEW TRANSCRIPT TO FOLLOW

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