How vital is Infosys' result for the market, IT space?

In an interview with CNBC-TV, market analyst, Sangeeta Purushottam gave insights about the market, sectors and her expectations from the earnings season.

She says that Infosys results are important because it represents that part of the index, which has held out fairly well in terms of both earnings and performance. If there were any disappointments there, it would have a fairly big impact on the market.

Below is the verbatim transcript of Purushottam's interview with Udayan Mukherjee and Mitali Mukherjee of CNBC-TV18. Also watch the accompanying video.

Q: How are you reading the market, through this earning season, do you think a little bit more of a cut is possible or the market should stabilise here and consolidate?

A: A little more cut is always possible. We have kind of established a range for ourselves and what has been interesting is that despite all the bad news that we saw a few weeks earlier, the market did not fall below 5,200-5,300 level that people were expecting.

Even if we look at it in more fundamental terms which is in terms of the forward multiple, we seem to be trading broadly in a range of about 14-15-16 times. So, it is a fairly narrow range that we have established for ourselves. My own sense is, we will be in a fairly rangebound kind of a state for a few months. As we go along in the more immediate next few days or weeks, the movements are going to get lot more stock specific as the results start coming out.

Q: How tight is that range for you, is 5,300 the lower end of it or have we made a higher base you think?

A: If we look at the very short-term, it seems that we have made a higher base. Having said that, given the various gyrations of the market that we all lived through over the years, one thing you learn is never say never, so possibilities always exists on the downside. But, I would say for the near-term it looks like 5,500-5,600 seems to be a kind of a higher base.

Q: How important is Infosys and IT generally for setting the earnings barometer and mood this time?

A: It is important because it represents that part of the index, which has held out fairly well in terms of both earnings and performance. If there were any disappointments there, it would have a fairly big impact on the market.

In that sense, yes, it is important but, unlike what used to happen in the past where it sets the tone for the rest of the sector, that we have seen change even within IT, we have seen movements get lot more company specific. So, I would say, it is important but it does not necessarily signal that the all the companies would do well.

Q: What do you think is a bigger headwind for the market now, is it going to be earnings, which could be patchy and therefore lead to downgrades or is it macro led by crude, global cues, even our own macro like IIP which is soft and inflation which is sticky, what do you think is the bigger headwind?

A: There are both headwinds. To my mind, the macro headwinds are lot more talked about and lot more understood. In some ways, we could argue that some of these things have got priced in or we maybe approaching the tailend of interest rate hike cycle or atleast so we hope. In that sense, I would say that we are perhaps a little ahead of what is happening in the West where inflation and rate tightening has just begun to rear their heads.

However, the bigger concern is that I don