The last five days saw the Sensex setting new records as it consecutively registered record closings and topped it by ending the week after touching a new lifetime high of 21,293.88. This happened mainly due to heavy capital inflows from foreign institutional investors (FIIs) which helped Sensex gain nearly 630 points is last five sessions.
Expecting the markets to rally further, experts still advice investors to carefully trade in the markets. Ashok Agarwal from Escorts Securities feels the current market scenario is best suited for short term aggressive traders who are willing to take risks for small returns. He said, “now is the right time for investors who want to make quick money from equities. But short term traders should not wait for larger gains and should book profits as soon as they get an opportunity.”
As far as long term investors are concerned, he added, “investors with a view of 12 to 18 months should focus on beaten down sectors to invest in. They should initially invest only 20- 25 per cent and continue adding after regular time periods. Sectors like steel, infrastructure and information technology are likely to perform in the coming days.”
Hopeful of markets to continue to surge and then consolidate on higher levels, Fortune Fiscal's Jagdish Thakkar said, “Indices might continue to rally further but investors should be extremely cautious as we are expecting the stock markets to be quite risky. The best strategy for investors would be to buy every time the market corrects and book profit on every rally.” Thakkar expects banking and automobile sector to perform now as they have see a lot of selling pressure during the last few months.
Ravi Rastogi from Globe Capital also expects the markets to show heavy volatility in the coming sessions. He said, “we are expecting choppy markets in the coming time and it is best for investors to avoid heavy investments till the time State Assembly elections are not over. Once the election results are out, the political scenario would become much clearer and then investors should formulate their strategies.”
Ravi feels the current market is for traders and long term investors should look for opportunities to book profits. He added, “the market is dominated by traders and institutions with the retail investors still preferring to park their funds in gold. This is the reason why gold prices have not fallen as sharply as the equity markets have surged.”
With most of experts advising defensive strategies, Kunal Saraogi from Equityrush holds a contrarian view. He said, “We expect the markets to continue rising for some time more as the overall tren remains positive. Investors should not rush in to book profits but wait till the market momentum dies out. Also every time indices correct, investors should make the most of these dips and invest a little more. We expect a strong bounce back from bank and non banking financial companies. Along with that pharmaceutical is another sector which investors should focus on.”