2010 Sensex range seen at 15000-19000: Ambit Cap

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2010 Sensex range seen at 15000-19000: Ambit Cap

Being bullish on the market post recent correction, Andrew Holland CEO of Institutional Equities and Equity Proprietary Trading, Ambit Capital Pvt Ltd, said, the first half of 2010 would remain volatile. Sensex range for 2010, he said was seen at 15,000-19,000.

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Being bullish on the market post recent correction, Andrew Holland, Chief Executive Officer of Institutional Equities and Equity Proprietary Trading, Ambit Capital Pvt Ltd, said, the first half of 2010 would remain volatile. Sensex range for 2010, he said was seen at 15,000-19,000. "I will buy on any dip towards 15,000."

Further Holland said that UK elections would be a major factor in determining where the global markets would head. Dollar, according to him might strengthen further on its flight to safety. Foreign institutional investor (FII) selling, he said was largely exchange-traded fund (ETF)-led. However, he was quick to add that some long-only funds had also sold on valuations. "2010 will be the year of stock picking," he added.

Here is a verbatim transcript of the exclusive interview with Andrew Holland on CNBC-TV18. Also watch the accompanying video.

Q: The market has corrected 10%. Are you expecting 10% more?

A: No I am actually getting more bullish. I think the markets were kind of priced globally for a perfection coming into the year. What do I mean by that is stimulus exits would be smooth with no problems. The dollar would remain weak, so the carry trade will continue and metals would continue to rise. All that has been turned on its head, mainly, because of what's happening in Europe. I am less for it now that this news is starting to be consumed by investors and the realization that there is risk still out there. I am a little bit more optimistic about the Indian markets for the first time for some time for sure. So now I am more bullish.

I do think its going to be a more volatile first half. I have always maintained that and the looming event to me is the UK elections and I think that is going to put pressure again on currencies and there is going to be a flight to safety and the dollar remains a trade there in terms of strengthening. It's what we have been expecting. So a more defensive stance is where we have come in at the beginning of the year and we would maintain that stance up until the budget and see what the budget has to bring if anything.

Then we will review our sector allocations then but at the moment keeping selectively bullish in terms of the defensive sectors but expect more volatile that is for sure.

Q: Globally, though what is your sense of how much risk premiums have recoiled in that are we almost done with the purging or could it be another couple of difficult weeks?

A: The first half of this year will be volatile and risk will kind of continue to play on the minds of the investors as the UK election looms probably around May. So whilst we look at Europe and say Greece will be bailed out, so will be rest of Europe because really you can't have a situation where Greece kind of pulls itself out of Europe Union. It will be too hard on the European Union. So they will have stimulus packages there.
 
What we have to notice is they have part of is that both Greece and now Spain is saying we are going to cut down on our spending and its really kind of exiting stimulus packages around the world because we are all waking up and saying we cannot just keep printing money or borrowing, you have got to pay back at some stage.

So there is tightening behind all of this and markets are now starting to put that into their earnings forecast. And when the world is on a shaky ground anyway in terms of recovery, the last thing you need is stimulus packages taken away albeit that they will need to be done anyway unless we have a huge sovereign risk problem, which everyone wants to avoid. So whichever way you look at it, growth is going to slow and that is going to highlight India more going forward and that is why I am getting more bullish on India.