Metals took a breather last week on profit-taking and geopolitical hostilities collapse: HDFC Securities’ Deepak Jasani

Deepak Jasani, head of retail research, HDFC Securities, said the former leading metals sector had paused due to profit taking and a drop in geopolitical hostilities while banks and sectors consumption were catching up with relative valuations.

In an interview with Zeebiz’s Kshitij Anand, Jasani points out that Nifty50 can trade between 17639 and 16988, while Bank Nifty can trade between 37318 and 35804. Edited excerpts:

Watch the Zee Business live stream below:

Q) Bulls took over the Indian markets this week. Benchmarks rose more than 4% in the holiday-shortened week. What led to the price action?

A) The apparent reduction in the intensity of current concerns (war, crude oil prices, etc.) has led to a drop in selling pressure across the globe and the deployment of equity cash by investors who have been waiting on the hit.

Foreign portfolio investors (REITs) turned to buyers towards the end of the week and small- and mid-cap stocks started to participate on the upside, reflecting better sentiments among retail investors.

Q) The Nifty50 is back above 17,000. What type of level do you expect for the index and NiftyBank in the coming week?

A) Nifty can trade between 17639 and 16988, while Bank Nifty can trade between 37318 and 35804.

Q) On a sector level, consumer and banking stocks have regained the upper hand. What led to the price action, however, last week’s ‘metals’ star was beaten? What led to the price action?

A) The former leading sector, metals, paused due to profit taking and the fall in geopolitical hostilities, while the banks and consumer sectors caught up to their relative valuations.

Q) The US Fed took the first step by raising rates that were priced in by market participants. But do you think further rate hikes could impact equity markets or the worst is factored in?

A) While the 25 basis point rate hike was in line with most expectations, any indication of a faster rise at the next meeting and the expectation of a faster than expected reduction in the balance sheet of the Fed could dampen sentiment.

Q) The bulls have taken over D-Street – do you think this level is appropriate to invest in or long-term investors could wait a while?

A) For people who are underinvested in stocks, they can start investing in Nifty stocks or other stocks where they have studied enough, gradually.

People who are fully or almost fully invested can wait for a decent correction before committing additional funds. In fact, they may seek to raise funds in the ensuing rally.

(Disclaimer: Opinions/suggestions/advice expressed here in this article are investment experts only. Zee Business suggests its readers consult their investment advisors before making any financial decisions.)

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