Bet on banks, NBFcs, pharma, 2-wheelers: JM Financial

Suhas Harinarayanan of JM Financial says after the year-to-date rally of 4.5 percent and 19.5 percent since the lows in February 2016, markets are no longer in the value zone.

From specific sectors and stocks, monsoon related ones continued to gain traction as deviation of monsoon from long period average dropped and area sown under paddy turned positive.

Given that the markets are now pricing in a higher probability of a double-digit earnings per share growth, there looks to be only a few domestic factors (GST primarily) that could drive markets higher in the near-term, he feels.

"Our recommended, bottom-up, model portfolio continues to be skewed towards private financials (banks, NBFCs), healthcare, and consumer discretionary (2 wheelers)," says Harinarayanan.