Cautiously optimistic on mkts: Anagram

Munesh Khanna, Chairman of Anagram Stock Broking said for the next two-three quarters there economic issues will remain and so he will stay cautiously optimistic about markets at this point in time.

On the Nifty he sees 5,020 level as a strong resistance and it would be range bound some time.

Excerpts from CNBC-TV18's exclusive interview with Munesh Khanna:

Q: Are you feeling a bit more hopeful or do you think this is just a relief rally and won’t last much longer?

A:  Essentially, it’s a relief rally and we have maintained for the next 2-3 quarters that there are still going to be issues in the economy, but I think one could say that one is cautiously optimistic at this point in time. All the global cues coming in, what we have seen is that if we see yesterday’s results of IBM, Intel and Ebay, a lot of it is coming out because of the weakness of the dollar, about how it is helping the US companies.

Q: What sort of range are you working with, if the market continues to trade stronger?

A: We believe that the 5,020 level is a strong resistance and that it would be range bound around 5-10% for some time. That’s what we would bet the market on. None of the basic issues have changed; the US continues to be in recession, there is pressure in that economy, we do have inflation in India out here, also the elections and we will have a CRR or a rate hike at the minimum.

In the US, the April 30 meeting would be the last of the rate cuts. So until there is not going to be a major change in the outlook, one would just need to look at specific companies and there are value picks at these levels. Fundamentally there are values out here, which one could get into, but overall from an index perspective, it would be a little difficult for it to break out at this point in time.

Q: Is it your sense that the trading interest might be coming back in the market even if the Nifty remains range bound?

A: There is some amount of optimism and people have stayed away primarily because they were very pessimistic, but as the optimism increases, the trading volume will increase. But we do expect that even if the market stays range bound and there are not too many surprises, people will come with some trepidation back into the market and the trading volumes which have been substantially low, would increase from here onwards.