Tag: buy on dips

Stocks eroded over Rs 7.36 lakh crore in investor wealth, as concerns over a new little-known South African variant of Covid with several mutations sent shivers down Dalal Street. The domestic market was already seeing sharp foreign outflows amid rising inflation globally and a hawkish US Federal Reserve stance. The fresh Covid fears may result in a flight to safe havens and selling in riskier assets, which could only increase equity outflows from emerging markets like India. Data showed investor wealth, as measured by BSE market capitalisation, plunged Rs 7.36 lakh crore to Rs 258.30 lakh crore from Rs 265.66 lakh crore a day ago, with severe fall coming in the second rung indices that fell up to 3 percent. The market breadth was extremely weak, with two stocks falling for every one that rose. Read more

The Indian benchmark indices fell over half a percent in morning deals today(9th July 2021), tracking weak cues from their Asian peers. The S&P BSE Sensex fell 310 points, or 0.6 percent, to 52,260 levels and the Nifty50 index gave up the 15,700-mark. Axis Bank, indusInd Bank, and Reliance Industries were the top Sensex drags. The stock of TCS was trading 0.85 percent lower at Rs 3,229 at 09:32 am, marginally recouping the morning loss. It had hit a high of Rs 3,274 in opening trade. There is a sudden bout of negative news for markets. The elusive virus, which is foxing even the World's best epidemiologists, has again become a threat with countries like South Korea and Australia imposing fresh restrictions. However, the valuations are excessive and there is room for markets to correct significantly. 'Buy on dips' may not prove to be a good strategy now. Profit booking and increasing the cash component in the portfolio are advisable, according to analysts.

The market mood is changing towards a bull run again, according to some analysts. The major positives for the market now are the steadily declining fresh Covid cases and fast-rising vaccinations, which will facilitate the further easing of restrictions and rebound in economic activity. From the market perspective, the fact that FPIs have ceased selling and the DIIs have turned aggressive buyers are strong positives. Therefore, it is quite possible that the market may again favour the bulls and the 'buy on dips strategy' may resume. Since exports are doing well & INR has depreciated, exporters are likely to do well. In banking, the share of the private sector in credit approvals has risen above 36% which is positive for the leading private bank majors.