Monday, December 4, 2023

Retail investor enthusiasm boosts market, caution urged on small caps


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Shillong, November 20: V.K. Vijayakumar, Chief Investment Strategist at Geojit Financial Services, warns against chasing small caps driven solely by retail investor exuberance.

As per IANS, despite recent under-performance, he emphasizes the safety found in large caps. With Foreign Institutional Investors (FIIs) showing buying interest in the cash market, the likelihood of significant selling is low, and further buying could occur with favorable developments.

The current momentum is notably seen in large-cap IT stocks, propelled by the improved prospects for the IT sector due to the expectation that the US will avoid a sharp recession. Resilience is anticipated in sectors such as autos, telecom, capital goods, and construction-related segments. Additionally, Vijayakumar anticipates a rebound in banking stocks in the near future.

He points out that the ongoing rally in the US market, driven by declining bond yields, sets a slightly favorable market construct for the continuation of the rally in India. Despite the BSE Sensex trading down 25 points at 65,769 points on Monday, there is an overall positive sentiment.

Among the notable market movements, M&M emerges as the top loser, experiencing a decline of more than 2 percent.

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