Even as the headline indices continue to soar to fresh record highs in quick succession, stock market experts say that there could be some consolidation in the near term.
Even as the headline indices continue to soar to fresh record highs in quick succession, stock market experts say that there could be some consolidation in the near term. The BSE Sensex ended the session 184 points higher to scale a fresh closing peak of 40,654 on Thursday, tracking gains in metal, energy and banking stocks as positive domestic and global cues enthused investors. “We remain cautious on the markets as it is hovering near its peak levels, consequently some consolidation can be expected in the near term,” Ajit Mishra Vice President, Research, Religare Broking told Financial Express Online.
Intra-day, the Sensex hit a new all-time high of 40,688.27. Shares of Sun Pharma, IndusInd Bank, RIL, ITC, Vedanta, Asian Paints, HDFC and Infosys, were among the biggest gainers, closing up to 3.02 per cent higher. On the other hand, Yes Bank, HUL, ONGC, Tata Motors, Axis Bank, L&T and NTPC closed up to 3.27 per cent down. The Sensex has soared to recrd highs, even as the government looks to provide a fillip to the ailing real-estate sector. The Narendra Modi-led government on Wednesday approved a Rs 25,000-crore fund to help complete over 1,600 stalled housing projects.
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While the rise continues for the headline indices, the rally seems to be close to maturity now and will undergo a correction soon, says Umesh Mehta of Samco Securities. “Since there is a lot of optimism around, an investor should follow a contrarian approach by not blindly getting into aggressive buying but wait for a decent correction before picking quality stocks,” Umesh Mehta, Head of Research, Samco Securities said.
Since the market is near an all-time high, Mishra recommends investors to buy stocks in a staggered manner. We do have a positive view on the Indian markets led by positive trade developments between the US and China, improved domestic sentiments, anticipated recovery in the economy and earnings revival, he said. Meanwhile, the Indian rupee appreciated 5 paise to 70.92 against the US dollar intra-day.