Dear patrons, the markets have had a roller coaster ride over the last year or so. In fact the markets have rallied and achieved new highs over this pandemic ridden phase. As they say "Cash is King", this market rally has been and is being driven by liquidity. There is ample liquidity around the globe with almost all governments providing packages to provide impetus to the economy. Economic activity has been hampered due to the ongoing pandemic. The pandemic now seems to be in control and we are likely to come out of the situation with the help of vaccines.
Let's now focus on what transpired in the markets over last week and how are they looking for the next week.
Last week markets were in buoyant mood. Domestic as well as global cues were on the positive side. The MPC came out with its decision to hold interest rate status quo, which added further fuel to the ongoing rally. The RBI Governor stated that the banking regulator will undertake all necessary actions to revive growth. RBI also stated that the Indian economy is expected to grow fastest in the World over next financial year. The growth rate was, however, revised downwards from 10.5% to 9.5%, owing to the horrific second wave. We believe the worst is over as far as the pandemic is concerned and markets have priced in that possibility. Moving forward the Nifty is likely to move upwards towards 16000.
As we can see the rally started from 14150 and should have enough legs to move towards 16000.
Midcap stocks have been participating in this rally big time. We believe that they will outperform large cap stocks for some more time. Once this rally is over, it will be prudent for investors and traders to chose stocks wisely and be nimble footed in trades.
We like select stocks in PSU sector along with PSBs. Select stocks in private sector are also slated to gain handsomely over next few weeks.
Stay Invested!!! Happy Investing!!!
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