Market experts do not expect any major recovery in the indices any time soon as the third quarter corporate earnings declared so far have not been good enough to boost sentiment and there is increasing possibility of higher redemption pressure coming in from domestic institutional investors in coming weeks.
There is a possibility of slight uptick in market if the Budget exceeds expectations but gains are likely to be short-lived. The pressure might resume as corporates prepare for advance tax payments in early March, experts say.
They are, however, divided on whether the weakness will spill into next year. While independent market expert, Ambareesh Baliga believes that Indian economy is strong enough for the market weakness to continue for such a long period, another expert Sudharshan Sukhani of s2analytics.com believes there is no reason why the weakness will not continue.
"People invested in systematic investment plans (SIP) are generally long-termers with 3-5 years perspective. I don’t think they should panic and sell out as this weakness may just continue for few more months," Baliga says.
Sukhani feels the Nifty may even touch 7200 levels soon.
"The major worry right now is not only the selling but the fact that the buyers seem to have vanished. Volumes are also way too low," says another expert Deepak Shenoy.