Sangeeta Purushottam of Religare Securities said that she would be surprised to see too much upside in tech stocks. The techs may not see high earnings growth; the sector looks fairly valued, she added. Banks could underperform for a while and may see margin compression, she said. According to her, the monetary policy has largely been factored in and most expect tightening measures. The market could still see some downside due to results, she said.

Excerpt from CNBC-TV18's exclusive interview with Sangeeta Purushottam of Religare

Q: What do you make of TCS after the results and do you see more upside in technology after the recent rally?

A: I think IT has shown some signs of bottoming out and given that the overall guidance has been reasonably inline with expectations, the sector has actually been viewed as defensive. This is because the guidance given out of by  companies have given some element of certainty of earnings. But if you look at it from the point that the valuations which actually touched bottom, they have moved up by about 10-15%. So I think the relatively higher confidence in the sector has actually been reflected in the prices to date. So I would be surprised if there is too much of upside from hereon.   

Q: What about the interest rate sensitives? How would you play them from here? Is the bad news all in the price or do you think banks etc will still underperform given your expectations of monetary policy action?

A: I think that banks could underperform for a while not just because of concerns on interest rate hikes and slowdown. Also we could possibly see some element of margin compression. We need to see how the results really pan out not just this quarter but over the next quarter as well. But what we have seen in the last few months it’s being the deposit growths been faster than credit growth. That itself should be putting some kind of pressure on margins. So I would say that it’s a little early to call that the worst is over for the sector.