It was a ‘Terrible Thursday’ for the market which crashed over 2 percent on geopolitical tensions and March F&O expiry. The Sensex plunged 654.25 points to close at 27457.58 and the Nifty fell 188.65 points to 8342.15.
N Jayakumar, President, Prime Securities, feel the hope rally is long over and thinks the markets lack conviction due to some uncertainties. “Little things like the coal block allocation, which is fantastic, very openly done, transparently done, big revenue collection, but then you hear that 2 or 3 of them are sort of getting called back. I don’t know if at the end of the day there is a method in this entire thing, I am really hoping there is because with one level of transparency and governance what has added on the other side is huge cost to the Indian corporate space,” he said.
According to Jayakumar, March is a peculiar month for Indian markets. “Whether we like it or not, there is lot of private funding that goes on in the market place which gets pulled out,” he said. He expects to see some relief in April “but it will be result-focused”.
Jayakumar feels the markets are displaying some amount of maturity. “The markets have been scaling new highs -- the number of new lows on a daily basis has almost kept pace with the number of new highs. Markets are ruthlessly banishing stocks they don’t like,” he said.
Anil Singhvi, Chairman, Ican Investment Advisors, too feels that the momentum which started last May seemed to be now almost getting over. “The hangover is over and people are coming back to the reality,” he said.
“We were ahead of the times but hoping that things will correct, hoping that we started with discounting FY15 earnings, then started discounted FY16 earnings then we started discounting FY17 earnings but at the end of the day the fundamentals have not changed at all,” Singhvi said.
He feels the situation on the ground remains as bad or as good as it was 8-9 months back. Thus the stock markets are correcting themselves instead of talking about FY17 which is looking far too off now.
“It is time when you take stock of the situation. Global markets are not looking up so well -- look at the global growth, currency issues. So, when you are having all these issues which have really confronted us in the last three or four months, things are working out,” he said.
According to Ajay Srinivasan, CEO, Aditya Birla Corp, there is no real trigger for the market at this point, and thus it may drift till it gets a direction.
“People are not expecting great quarterly earnings for March. I don’t think internationally there are any great positive triggers that are coming. The FOMC is out of the way; whatever has to happen will happen. So, it is going to take a while for the market to kind of find feet and go forward,” he said.
Srinivasan expects the markets to find a new direction in the next six months. “I think you have got to start seeing signs from Budget. The government push has to start translating into stuff so you have got to start seeing the infrastructure spend on the ground, you have got to see tenders being set out – I think that sign will be good enough for the market,” he said.
P Phani Sekhar from Karvy Stock Broking is not concerned with the market fall as he feels it is predominantly coming out of FII selling. “We have seen so many times in the past when there are no structural concerns to the construct of the market and when it arises out of a technical issue of FII selling and that too because of a Yemenese problem which I am sure nobody till yesterday was talking about,” he said.
Sekhar expects the problem to resolve itself because fundamentally compared to where the markets were at say 30,000, things are now improving. “You had a couple of ordinances turn into legislations; you had a successful coal auction, you had a successful telecom auction so, I do not think one should be too much seriously concerned and from the top we have lost 8 percent. Of course some high EBITDA stocks have corrected by their very nature by 12-15 percent but that should be okay for a longer-term investor,” he added.
Sudarshan Sukhani of s2analytics.com thinks the Nifty has come to a very strong support zone. One has to take profits now and should short it. “Do not carry positions from today onwards. At least we will see then how the markets then will pan out. The downtrend is not over but at least a pause is quite possible,” he said. He advises three stocks to go ahead and trade for a BTST -- Oil and Natural Gas Corporation (ONGC), Jubilant Foodworks and ACC.
Discover the latest Business News, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!
