Sensex, Nifty crash appears jittery, but it may be the right time to enter markets; here’s why

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Updated: February 6, 2018 12:14:52 PM

Panic in global markets triggered Sensex and Nifty to come down crashing over 1,000 points and 370 points respectively in the opening trade. A market-wide sell-off pattern was observed in the Indian equities as the US benchmark index Dow Jones Industrial Average tumbled as many as 1,175.21 points on Monday.

budget 2018 says this on ltcgA market-wide sell-off pattern was observed in the Indian equities on Tuesday.

Panic in global markets triggered Sensex and Nifty to come down crashing over 1,000 points and 370 points respectively in the opening trade. A market-wide sell-off pattern was observed in the Indian equities as the US benchmark index Dow Jones Industrial Average tumbled as many as 1,175.21 points on Monday, posting its biggest intraday decline in history shedding nearly 1,600 points.The 4 percent crash in US markets wiped out most of their gains for 2018 and led most of Asian indices to open in deep red. The sell-off was triggered by the sharp jump in US bond yields on Friday following the release of US jobs data, which grew at the fastest pace since 2009. The data sparked concerns the US Federal Reserve may raise interest rates quicker than anticipated. With most of the shares trading in red, investors are getting panicky on how to save their hard earned earnings from getting eroded. However, the sell-off may look draconian, it provides a very good opportunity to enter the markets at low levels.

“It’s a good correction and there is nothing to worry. It’s good time for investors who missed the boat to re-enter. We have a Nifty target of 11,100 for this year,” says Edelweiss Securities that sees current fall in market a good opportunity to enter.

Amidst the investor scare, ace investor Porinju Veliyath of Equity Intelligence India Private Limited in a note to his PMS clients advised to use this turmoil in the markets as an opportunity to add more funds and grow their money further. “Corrections like this are witnessed keep markets healthy as they keep a check on complacency, leverage and excesses,” he said.

Sharing his views on the market outlook, Sandip Sabharwal of asksandipsabharwal.com told FE Online, ”The market crash is a bull market correction which comes every two years. The last crash was in February 2016 and those who bought at that time did not regret. The same holds true this time. Most reasons being propounded for the fall are post facto justification. Overall risk reward after the correction is in favour of long term investors.”

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