last week the benchmark Sensex ended with a sharp decline of nearly 350 points amid heavy profit booking form institutions, traders and retail investors.
But going ahead, experts expect stock markets to bounce back before the Union Budget and urge investors to take advantage and buy midcap and small cap stocks on every decline.
Despite the sharp fall, Jagdish Thakkar from Fortune Fiscal is quite optimistic about the markets and does not expect the correction phase to continue for long. He said, “After this sharp correction I am quite positive now and expect equities to bounce back in anticipation of the new Government’s first Budget.”
Thakkar is expecting a strong bounce back in the coming days and is certain that frontline indices would again touch their life-time highs. As his advice for investors, Thakkar added, “Investors can buy technology, pharmaceutical and automobile stocks but should try and avoid cement shares completely. Their strategy should be to buy on every correction and should not pour in their entire fund in one go.”
like Jagdish, RK Global Security’s Rakesh Bansal is certain that the downside in the markets is now small and soon rally would resume. “This is not going to be a deep correction and we expect markets to bounce back soon.” But unlike other experts, Bansal gives advice investors to stay stock specific rather than focus on a complete sector.
As his strategy for investors, Bansal said, “Investors should avoid trading in commodity or real estate and instead invest the same money in equities. More focus should be on midcap and small cap shares which have the caliber to double themselves in the coming months. Investors can buy shares like Unitech, Suzlon and Ashok leyland and would get good returns.”
Kunal Saraogi from Equity Rush still remains quite bullish on the markets and urged traders to constantly look for opportunities in the markets especially outside the large cap segment.
He said, “Overall sentiment of the markets remains positive which is evident from continuous buying by foreign institutions. last week’s correction was only due to profit booking which I think is over now.”
Expecting to see a strong bounce back in the markets, Kunal advised, “Investors should not rush to sell their holding and wait as the markets are expected to again rise to their record levels. Traders should use every dip and buy high momentum midcap stocks but should avoid holding them for long. Traders should simultaneously book prfits and again initiate buying.”
Unlike other experts, Ravi Rastogi, a senior market analyst, still expects correction to continue for a few more days. Holding a slightly skeptical view on markets, Rastogi said, “I do not think the correction is over and expect markets to fall further. But on the medium term, I am also quite positive on the markets and would advise to buy on lows.”
Rastogi considers Monsoon and upcoming Budget to the key triggers for the markets ahead and urges investors to make strategies keeping them in mind. As his advice, he added, “Investors should buy midcap and small cap stocks. They should buy with a staggered approach and invest on every decline. I am expecting a strong pull back in banking, infrastructure and power stocks as we approach elections.”
Apart from these sectors, Rastogi further added that coal related stocks would show strong bounce back as the new Government is expected to take measure in improving the entire sector. Commenting on rupee, he added that going ahead domestic currency might weaken more and this would result in strong rallies in information technology shares.