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Fed move likely pushed to Sep; mkt pause to continue: HSBC

Even as the US Federal Reserve overnight stayed away from saying it would be ‘patient’ in raising interest rates for the first time in eight years, it said economic conditions were deteriorating a bit.

Even as the US Federal Reserve overnight stayed away from saying it would be ‘patient’ in raising interest rates for the first time in eight years, it said economic conditions were deteriorating a bit.

Speaking on the development, Jitendra Sriram, MD and Head of Research, HSBC India, said he believes the Fed would not hike interest rates only at its September meeting, instead of in June, as was expected earlier.

In an interview with CNBC-TV18’s Latha Venkatesh and Sonia Shenoy, Sriram, however, said that beyond a break relief rally, Indian shares would continue to take a breather for the next three-four months, thanks to the lack of any likely earnings support ahead.

On triggers that could push Indian equities higher, Sriram said while expects only more rate cut by the Reserve Bank of India (25 basis points in June) this year, a progress on the legislative front could wake the market out of its slumber.

“We are positive on the market from the medium term perspective, say over two-three years,” he said, adding that investors should seek opportunities in paints companies, urban-facing consumer plays, media firms or capital goods companies focused on rails and roads.

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