Indian market which has rallied by over 50 percent since March-end to fresh record highs in December could face some consolidation in 2021 as valuations look expensive at current levels, Nikhil Kamath, who's a co-Founder and CIO, True Beacon and Zerodha said in The Market Podcast with Moneycontrol.
The Nifty50 which was trading at 8,597 as of March 31 rallied by about 55 percent to 13,392 recorded on December 8.
The current euphoria which we are seeing in equity markets partly on account of abundant liquidity, vaccine hopes, improvement in economic fundamentals, as well as the expectation of stimulus package from the central bankers across the globe.
“I think the year 2021 will be range-bound, hopefully, we could see a correction between 5% to 10%, and that would take it to a more normalized level,” said Kamath.
“If the earnings also slowed down in the first quarter of the next financial year, then I think it should bring the markets back to the 12,000 to 12,700-12, 800 kinds of levels, at least,” he said.
When asked about the possible winners or sectors that are likely to hog the limelight then Kamath is positive on the IT and Pharma space.
“IT and pharma will typically do well when volatility comes by. And, if one prediction I can make at this point of time,” said Kamath. He further added that based on the above premise, I would say IT and pharma might be the decent places to hide.
(Please tune in to the podcast for more)
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