The Hindu Business Line : Market View

MR SANJAY SINHA, Head of Equity, SBI Mutual Fund (left) with Mr Srinivas Jain, Chief Marketing Officer, SBI Fund Management, at the launch of SBI Infrastructure Fund Series I in New Delhi. (See Update column for more details). — Ramesh Sharma

The market looks healthy, trading in the range of 12500-13000-plus levels as recovery continues. Corporate earnings are strong. The fact that India has under-performed the EMs (emerging markets) may suggest that some catching up could take place, given that investors seem to have regained confidence in Indian equity on signs that Corporate India is in good shape. Despite a positive outlook, bouts of volatility cannot be completely ruled out as the Indian capital market, economy and businesses are no longer insulated from global geo-political and economic events. On the domestic front, the market could remain cautious on account of the RBI's monetary tightening and its consequent impact on the growth momentum. Hence, high return expectations may be difficult to sustain. The market, however, seems to have factored these concerns into current price levels.

ICICI Prudential Mutual

The market continues to witness heavy buying on any sharp correction. The phenomenal strength in global markets has been a major reason for the firmness. Short covering and under-ownership generally have also aided the firmness. However, it has been seen that buying interest reduces considerably at Sensex level of over 14,000.The strong rupee and continued measures to contain inflation could impact profitability in a few crucial sectors. Strong global markets, positive flows and huge cash balances waiting to be deployed provide support from any major correction. Our strategy would be one of caution.

Reliance Mutual

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