RBI rate cut may propel Nifty trading in mkt positive
Market has been able to sustain the upward move and has remained bullish from a trading perspective, The earlier assumption of resistance at the 7550-7600 level, for now, has been quashed, he said. Global volatility, seen in January and February, has reversed, he added. The market have now reached a stage of compliancy, Mukherjee said. "It gets trickier from here on because a large part of the rally has played out," Mukherjee said, adding that if the foreign institutional investor (FIIs) inflows continue, Nifty could move closer to 8000-8100 levels from where it had fallen earlier.The upmove in exchange traded funds (ETFs) is more of a tactical reallocation, he said.
25 basis points rate cut by the Reserve Bank is
already priced in. “This (rate cut) will give Nifty another 100 points on the
upside,” he added. The market is still vulnerable to global risks, he said,
adding: “The quality of a rally is suspect.” The rally has been led by sugar
and metal names and not any blue-chip names. Expectations from even the
fast-moving consumer goods (FMCG) sector are not great, he said. We might see
another 6-7 percent upmove in the sector, he added. However, he is positive on
the cement sector and said that volume growth has improved by over 10 percent
in the last few months. The only issue is of valuation, which was pretty high,
he said, adding that midcap names like Shree Cement s and JK Lakshmi can be
looked at.
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