How experts see the ongoing market rally

While the ongoing bull run has lifted the valuation to all-time highs, the fear of correction looms large over the D-Street. The benchmark Sensex added a whopping 6,000 points since January and touched 56,000 on Wednesday.

Due to the Covid-induced disruption, the stock market tanked over 35% in March 2020. It has rallied over 118% then and after scaling 50,000 in January, the Sensex has peaked the 56,000-mount earlier this week.

“We may have reached a point from where markets could react significantly. We are expecting international markets also to correct a bit. So, given the softness globally, I believe at this stage investors should adopt strict stop losses on their portfolio, since the valuations are very high,” said Vinit Bolinjkar, Head of Research at Ventura Securities.

According to Siddhartha Khemka, VP – Head of Research at Motilal Oswal Financial Services, “Financials have been the backbone of the equity market. However, if you look at the recent past, things have been a lot volatile. In the past also owing to various reasons, like demonetization and GST, busnisses – atleast the MSME segment was impacted which led to resurgence in slippages. Again due to the covid-induced lockdowns, we saw slippages increasing across banks and disburments were sluggish. Healthy deposits has only been the good part. And there has been a shift in slippages from the corporate side to the retail side.”