NSE Nifty 50 may jump 10 per cent from current levels to 17500 by mid-July, says Sanjiv Bhasin, Director, IIFL Securities. In today’s session, Nifty 50 hit a day’s low of 15,760.95. Sanjiv Bhasin in interview with Surbhi Jain of FinancialExpress.com, said that BSE Sensex could fall to 53000 on the downside, and then reclaim 57000 levels in mid-July, as last week of June could see reversal of ‘sell the rallies’ to ‘buy the dips’. The second half of July is likely to see global rally resumption after a strong correction. Bhasin suggested investors should focus on midcap stocks as they offer great buying opportunities amid stock market volatility. Here are edited excerpts from the interview.
1. What do you make of the current stock market scenario? Is it just a correction or is there more pain ahead?
The inflation data and rate hike cycle in the US are seeing high volatility with constant foreign selling seeing all rallies being sold into. However, this is the time to distinguish the ‘men from the boys’ as Indian and world markets pricing all negatives. Expect 15700 to hold in June and last week could see a test of 17000.
2. LIC share price has tumbled 25% from IPO price? Should investors buy, sell, hold?
Hold, nervousness in stocks and index seeing weakness, both are leading to mid caps and new listings, remain under pressure. Since new age private insurers are seeing better prospects in near-term LIC under pressure.
3. Where do you look for opportunities in a volatile market? What are the top sectors to bet on?
Auto, banks, capital goods & IT are offering excellent opportunities with select mid caps giving you a great buying opportunity as near term almost capitulation takes place in them.
4. Where are BSE Sensex, Nifty 50 going in near to medium term?
BSE Sensex could see 53000 being hit on the downside with 57000 coming by mid July, while Nifty could see 15700 to 17500 by mid July.
5. What are the key drivers and triggers for Indian stock markets going ahead?
Look at the indicators, CV cycle is seeing strong rebound with Bajaj Auto announcing buy back & indicating the best results in 2nd half of the year. Ashok Leyland seeing strongest growth & demand in bus & CVs. Mahindra & Mahindra (M&M) hitting fresh new highs, cement seeing the biggest deal of the last 2 decades take place in days not months. IT large & mid cap companies seeing no effect of inflation on order book and travel & tourism seeing best growth in over 2 years as reopening takes place with a vengeance. Also, watch the indices of Russia & China which are seeing the strongest rebounds globally as ETF flows see exit in US & rebalancing in other markets. If we, as expected by me, do get some semblance of peace talks between Russia/Ukraine by mid July expect crude prices to fall sharply which will see Indian stocks rebound the fastest.
6. How can investors protect their investment portfolio against rising inflation?
Concentrate on portfolio allocation with a certain amount in SIPs & also rising yields make debt a good place to park some money.
7. Are we in a sell-the-rally, or buy-the-dip moment?
We think by last week June we should see reversal of ‘sell the rallies’ to ‘buy the dips’, with the 2nd half of July seeing the resumption of the global rally after a strong correction.