Sandeep Sabharwal CEO- PMS Prabhudas Lilladher says markets are in a new bull phase after benchmark indices have jumped over 10% in the first five weeks of 2012. However, the pace of the up move is faster than expected, he said.
"A new bull phase may have started," Sabharwal told NDTV Profit today. The kind of negatives that we saw...I haven't seen in a long time. There might be intermittent corrections in between but markets will go much higher than currently, he added.
What's driving the markets?
Most negative concerns have peaked.
Fundamentals have bottomed.
Interest rate cycle has peaked.
FY 13 earnings may be revised upwards:
Projections for the next year seem to be pessimistic but as iput costs and interest rates come down, earnings will be much higher than expected, which will give a justification for the market up move next fiscal (FY13).
What should investors do?
Most investors are still on the sidelines, Sabharwal said. But in a bull market it's never too late to get in.
Top picks:
Buy private banks: ICICI Bank, HDFC Bank top picks
Why: Asset quality have held up and not deteriorated as much as expected. NIMs (net interest margins) have also held up.
Buy capital goods:
Why: Low visibility and cheap valuations. As interest rates reverse, cap goods and infra will pick up.
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