The marketcapitalisation of BSE-listed companies climbed above $ 3trn mark and experts feel that the rally has more steam which could take benchmark indices to fresh record highs in the next few days.
The S&P BSE Sensex is just 3 percent away from retesting its record high of 52,516 while the Nifty50 is just about 1 percent away from creating history, as of May 26 closing data.
Nifty hit a fresh record high on May 28.
ICICIdirect sees the rally to continue up to 16400 levels which translates into an upside of over 7 percent from May 26 level of 15,301.
The index formed a strong support base in the range of 14400-14600 despite anxiety around surging Covid-19 cases across India
“The formation of higher peak and trough coupled with multi-sector participation makes us confident of reiterating our structural positive stance. We expect the Nifty to resolve above lifetime highs of 15400 and eventually head towards the revised target of 16,400 over the next quarter, led by BFSI, consumption, auto, and infra,” said the ICICIdirect note.
“In the process, we do not expect the index to breach the key support threshold of 14600. Thus, dips should be capitalised on to accumulate quality large-cap and midcaps,” it said.
The broader market has been a marked outperformer in the recent past. The brokerage firm expects the broader market outperformance to accelerate wherein catch-up activity would be seen in small caps.
Based on ICICIdirect technical study, it expects cyclical to outperform, and bargain buys are in sectors like consumption, infra, capital goods, IT as well as telecom. The brokerage firm remains neutral on oil & gas while BFSI, pharma, chemicals, auto, and PSU stocks are in the outperformer bucket.
Bargain buy across 12 sectors include names like Kotak Bank, IndusInd Bank, TCS, Infosys, Tata Steel, Indian Hotels, Indigo, Sagar Cement, SAIL, Escorts, JK Tyre etc. among others.