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    Sensex, Nifty will scale past all time highs, but...

    market | IST

    Sensex, Nifty will scale past all time highs, but...


    Atul Suri of Marathon PMS is very bullish on Indian equities. He also highlights some themes that he is bullish on. However, he puts out a caveat that may dampen any upcoming rally.

    Indian equities are not only poised to scale their lifetime highs but stretch well past them, according to Atul Suri of Marathon Trends PMS. However, Suri issued a caveat soon after which can result in a pullback.
    "The problem is that if global markets tank for whatever reason, that's what can burst this move," he told CNBC TV-18 in an interview, adding that India is in a "full-blown bull market" that is not visible due to the external noises.
    Indian equities have staged a sharp recovery from the recent lows in June, with the Nifty 50 scaling past the 18,000 mark for the first time since April this year. The index came within touching distance of its previous all-time high of 18,604 before witnessing a bout of profit booking. In fact, the Nifty Bank index made a fresh record high of 41,840.
    The recovery has meant that both the Nifty and the Sensex are flat for the year compared to their counterparts in the US, the S&P 500 and the Dow Jones, which are down close to 20 percent.
    Suri believes that the lows made by the market in June are very important — global and local alike. Global equities are now looking forward to the policy decision from the US Federal Reserve. The US central bank has hiked interest rates four times in a row, and the markets are pricing in another 75 basis points hike later this week. However, bets for a 100 basis points hike are not completely off the table either.
    "If the markets don't take out those (June) lows, I think it will be very positive," he said.
    Defence stocks have been among the top performers this year with stocks like HAL (up 100 percent) and BEL (up 60 percent) providing stellar returns to investors. As a theme, defence is 'overweight' in Suri's portfolio, but beyond the share price returns, the moves in such names also provide a broader picture.
    "These sectors have not done well for a decade, and they talk about a changing cycle," Suri said. "If I look at the markets, I feel that the industrial cycle is turning, something we last saw in 2003-04."
    India's current ETF AUM is currently over Rs 4 lakh crore, but Suri believes that the decade of ETF outperformance is now over, and as liquidity starts to tighten due to central bank policies, things will start to get more qualitative. "Money is there, investors are there, but they are going to be a lot more selective and that's where India stands out," he says.
    Other Key Takeaways From The Interview:
    • This is a great "buy-on-dips" market
    • The market today is being driven higher by stronger hands
    • There is a lot more action happening in financials beyond Kotak's & HDFC's
    • This market is not defensively poised. It is poised for growth
    • Check out our in-depth Market Coverage, Business News & get real-time Stock Market Updates on CNBC-TV18. Also, Watch our channels CNBC-TV18, CNBC Awaaz and CNBC Bajar Live on-the-go!
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