The markets consolidated today, after yesterday's sharp rally. Midcaps outperformed the large caps yet again, the Nifty closed at 5,698, down 33 points, while the Sensex shut shop at 19,127, down 120 points. The midcap index closed up nearly a percent at 7,829.
Amitabh Chakraborty, Pres-Equity at Religare Securities has a view that that the midcaps would be moving sharply going forward because the valuation gap has widen between the large caps and the midcaps and some profit booking will happen in the large caps. “That money will get rotated in the midcaps only those where the Q2 results have been good, where the Q3 visibility would be good and the management quality is impeccable. So that is something we believe will happen and we will see that happening in January” he says.
Experts believe that in the short-term over the next few months, there will be continued volatility in the markets which has more to do with the global scenario and concerns on US recessions which are growing day by day. Global credit markets are continuing to be in a turmoil state and that’s a concern, which will certainly lead to more volatility.
Analysts feel that the participatory note issue is also having its impact over a period in terms of caped flows and FII inflows in the markets though the earnings growth trajectory remains quite strong.
Anand Tandon of Gryffon Investment Advisors, feels that for the moment, the markets are not in a hurry to reach new highs. They are near top-end of the range and the next movement would be downwards, he feels. The range is getting established and may cause a breakout in the next few weeks, Tandon said. “Since we still haven’t seen the back broken in terms of local interest in the stock market I don’t think the downside is perhaps to lock. But all said and done, the range is now getting established and there is nothing that looks like it will cause a breakout in the next few weeks, at least "
Source: Moneycontrol.com
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