NEW DELHI: The market saw all shades of red on Monday, thanks to rising inflation and poor quarterly show so far by key Nifty companies. Benchmark indices extended the losing run to the fourth straight session.
The 30-share flagship BSE Sensex tumbled nearly 1,200 points, while its broader peer Nifty sank over 300 points. The might of bears was so much that both indices formed ‘Death Cross’ on technical charts, which is considered a bearish signal.
Infosys and HDFC twins were among the biggest drags on the market while NTPC and life insurance stocks bucked the trend, ending the day in green.
Here is how market veterans and analyst decoded the market crash:
Naveen Kulkarni, Chief Investment Officer, Axis Securities:
We expect FY23 to witness continued volatility in equity markets, especially in the first half of the year with rising interest rates globally and high inflation, which is expected to persist. In this scenario, we expect money to move from long-duration debt funds to equity funds in the second half of the year, which should bode well for equities.
We continue to remain positive on sectors like metals, hospitals, hospitality, oil refining and capital goods. Some underperforming sectors might include discretionary consumption, IT and NBFCs.
Mitul Shah – Head of Research at Securities:
The market is trading lower due to aggression in the Russia Ukraine war in the last few days. Moreover, a sharp 4.6% decline in the IT sector impacted by Infosys results which came lower than expectations with rising attrition and weakening margins pulled down the overall market. The management has guided for lower margin territory citing mounting cost pressures despite healthy revenue growth guidance.
Global indices are also trading lower with more than 1% decline in Nikkei. US 10-year treasury yield cross 2.8%, also led to selling in the Indian markets.
Vineet Bagri, Managing Partner at TrustPlutus Wealth:
Post the close to 2% fall in the markets today, the 1 year forward P/E multiple now stands around 20x which is a fair valuation level. If we see further dips this week, we believe sentiments would sour further and risk averseness would go up considering the fact that the result season has not started off on a good note. Nonetheless, we suggest slow and steady buying of the dips especially for long term investors and not shy away from the market entirely.
Sandip Sabharwal, independent market expert:
I think it is more of an opportunity market. Overall I do not think the markets will do much this year, I do not see much returns from people who are hugging the index but specific opportunities will keep on coming and that is what we have to keep on buying.
Ajit Mishra, VP – Research, Religare Broking:
We believe global cues as well as the outcome of Q4 earnings will continue to add volatility in the coming sessions. Hence, we would remain cautious on the markets and suggest traders to keep their position hedged.