There is no Christmas cheer on Dalal Street as the markets fall for the fourth straight day, recording its biggest losing streak in close to about three months. The Nifty and the Sensex see their biggest one-day fall in three months.
In the last three days, the BSE companies have erased market-cap gains of the last three months. What led to the fall on Dalal Street and will the IT sector recover in 2023?
Mihir Vora, director, and CIO at Max Life Insurance believes it is just one of those weeks where the market is probably overreacting to global events. "It may be a bit of year-end lack of buying from FIIs is what it looks like," he said.
According to him, it is natural that in a rising interest rate scenario, the smaller companies tend to get hit more and that is probably one of the reasons why small-caps are not performing in the last two-three months.
Vora is negative on IT, "I would rather buy into the domestic stocks which have fallen more. Some of the financials have fallen quite a lot in the last couple of months. So I am more bullish on the domestic recovery theme."
Public sector undertaking (PSU) banks are more of a tactical play and he would stick to the private sector banks, he mentioned. He prefers private sector banks versus non-banking financial companies (NBFCs) given the funding costs.
He believes in the last couple of months, things have become more attractive for new-age companies, "We are nibbling into the space."
Most of the defence stocks are now down 15-20 percent in the last week. Sharing his views on this sector, Vora said, "It is a secular story, which has just started in the last couple of years and can last for many years."
For the entire discussion, watch the accompanying video