Investors can have a stock specific approach in mid caps and small caps as there are many companies that are trading at a discount of 50-70 percent to their peak price.
In the last week, the Sensex and Nifty were up nearly 1 percent. The rupee appreciated 1.70 percent (Rs 1.21) against the dollar as it ended at 69.94 on December 29.
Foreign portfolio investors (FPIs) bought net shares worth Rs 1,731.91 crore on Thursday. On the other hand, for the first time in two decades, India witnessed higher foreign investment than China.
In 2018, India saw more than $38 billion of inbound deals compared with China’s $32 billion, buoyed by stable fundamentals, a bankruptcy code and fresh opportunities in sunrise sectors.
In a key domestic development, the Finance Ministry will be infusing Rs 28,615 crore in seven state-run banks by December-end to help meet the regulatory norms on maintaining adequate capital buffers.
The government last week sought parliament's approval for infusion of additional Rs 41,000 crore in state-owned banks through the second batch of supplementary demands for grants. That takes total recapitalisation for 2018-19 to Rs 1.06 lakh crore.
As the state election results and uncertainty at RBI are over, the market would now track global cues and Q3FY19 earnings season. We believe Q2FY19 earnings season was a mixed bag but Q3FY19 could be much better.
All eyes will also be on the last budget of the current government to be presented before the general elections. We do expect volatility as the central government may resort to populist measures to gain back popularity amongst the rural community especially farmers after its loss in key states like Madhya Pradesh, Rajasthan and Chhattisgarh, which street participants may not prefer.
As crucial assembly elections results are out, the question that comes to our mind is which party will win the general elections. It may be difficult for both major parties BJP and Congress to get a majority. Street participants would not prefer a coalition government as decision making and execution becomes difficult in coalition regime for obvious reasons.
The strategy at present should be to invest in a phased manner only in companies which are not connected to any political party, have a robust business model, strong earnings and cash flow visibility, low debt and backed by quality management especially on the corporate governance front. Considering the above factors, investors can have a stock specific approach in midcaps and smallcaps as there are many companies that are trading at a discount of 50-70 percent to their peak price.
On a safer side, we would suggest investors to look at pharma MNCs, consumption stocks, PSU banks, which even after recent rally are trading at depressed valuations (looking better after the cleanup of NPA mess, progress made under the NPA resolution framework under IBC, faster resolutions under NCLT and proposed recapitalisation), IT sector and private insurance companies at the current moment.
NSE & BSE TIPS, INTRADAY TIPS IS A CRUCIAL PART OF OUR ADVISORY RECOMMENDATIONS! TO EXPLORE MORE IN FINANCIAL TRADING CLICK HERE AND SUBSCRIBE US FOR FREE>> Stock Option Market Tips
In the last week, the Sensex and Nifty were up nearly 1 percent. The rupee appreciated 1.70 percent (Rs 1.21) against the dollar as it ended at 69.94 on December 29.
Foreign portfolio investors (FPIs) bought net shares worth Rs 1,731.91 crore on Thursday. On the other hand, for the first time in two decades, India witnessed higher foreign investment than China.
In 2018, India saw more than $38 billion of inbound deals compared with China’s $32 billion, buoyed by stable fundamentals, a bankruptcy code and fresh opportunities in sunrise sectors.
In a key domestic development, the Finance Ministry will be infusing Rs 28,615 crore in seven state-run banks by December-end to help meet the regulatory norms on maintaining adequate capital buffers.
The government last week sought parliament's approval for infusion of additional Rs 41,000 crore in state-owned banks through the second batch of supplementary demands for grants. That takes total recapitalisation for 2018-19 to Rs 1.06 lakh crore.
As the state election results and uncertainty at RBI are over, the market would now track global cues and Q3FY19 earnings season. We believe Q2FY19 earnings season was a mixed bag but Q3FY19 could be much better.
All eyes will also be on the last budget of the current government to be presented before the general elections. We do expect volatility as the central government may resort to populist measures to gain back popularity amongst the rural community especially farmers after its loss in key states like Madhya Pradesh, Rajasthan and Chhattisgarh, which street participants may not prefer.
As crucial assembly elections results are out, the question that comes to our mind is which party will win the general elections. It may be difficult for both major parties BJP and Congress to get a majority. Street participants would not prefer a coalition government as decision making and execution becomes difficult in coalition regime for obvious reasons.
The strategy at present should be to invest in a phased manner only in companies which are not connected to any political party, have a robust business model, strong earnings and cash flow visibility, low debt and backed by quality management especially on the corporate governance front. Considering the above factors, investors can have a stock specific approach in midcaps and smallcaps as there are many companies that are trading at a discount of 50-70 percent to their peak price.
On a safer side, we would suggest investors to look at pharma MNCs, consumption stocks, PSU banks, which even after recent rally are trading at depressed valuations (looking better after the cleanup of NPA mess, progress made under the NPA resolution framework under IBC, faster resolutions under NCLT and proposed recapitalisation), IT sector and private insurance companies at the current moment.
NSE & BSE TIPS, INTRADAY TIPS IS A CRUCIAL PART OF OUR ADVISORY RECOMMENDATIONS! TO EXPLORE MORE IN FINANCIAL TRADING CLICK HERE AND SUBSCRIBE US FOR FREE>> Stock Option Market Tips
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