Andrew Holland, CEO of Ambit Investment Advisors, says if the monsoons are going to be where they are today, then there can be a 50 bps Reserve Bank rate cut around August-September.
Globally, he believes China is more worrisome than Greece. He is also worried about the US Federal Reserve rate hike situation.
Below is the verbatim transcript of Andrew Holland's interview with CNBC-TV18's Latha Venkatesh and Surabhi Upadhyay.
Latha: Are you getting a sense at least from an Indian investors point of view that this will remain noise and that every time Indian markets dip because of Greek headlines that would be an opportunity to buy?
A: Yes, by and large Greece is less of a worry to me but I still want to see the details because I really have to see what Greece will be facing going forward and how much the European Union is going to support them. That said China remains the worry part for me as well as Fed rate hikes because we are going to have much more bigger impact on the global economy and markets than the Greece exit or their staying in the euro will have. So those are the two trigger points for me for the next couple of months.
Latha: At the moment you said you would watch out for RBI action and for earnings, are you expecting a rate cut in August?
A: Depends really on the monsoons. If they are going to be where they are today, then definitely I am still looking at a 50 bps (cut) around August-September, so that is still doable by the RBI governor.
Surabhi: It is a one percent rally; it is largely driven and triggered by what we have got from the West in terms of cues but it is a very well mixed up rally as well. A lot of parts of the market are moving higher, the Bank Nifty is up about seven-tenths of a percent, FMCG and pharma stocks, so there is a bit of a defensive tone to this rally as well. At the same time, IT is having a fantastic session today. In fact just to talk about some of the IT big boys, HCL Tech 3.5 percent, Wipro, TCS, Infosys have gained between 1 and 3-3.5 percent, so just your sense - IT has been such a big news point right after the TCS results, the profit warnings we got heading into this earning season, the rupee as it stands today, what is your view on the sector, the rally that is playing out today and how you would rate it?
A: I would sell into this tech rally. The decade of growth is over for them, I am not going to invest in the tech sector whatsoever for a long time to come until I start to see growth at the top line and whether Greece is in there or not, I don’t think it helps the overall industry, so I would sell into this. It is just a relief rally all around which most people would sell into as the day as the day wears on.
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!
