Markets rebounded last week on strong quarterly earnings globally and hopes of a slowdown in the pace of Fed rate hikes. A fall in crude oil prices, a recovery in rupees and the fact that foreign equity flows into India turned positive in July after nine months, have all boosted investor sentiment. The fact that earnings downgrades have been limited so far this season and the RBI commentary suggesting inflation may have, also adding to the bullish view.
ETMarkets caught up with Suresh Soni, CEO, Baroda BNP Paribas Mutual Fund, to know how he sees the ongoing valuations, the reasons behind the recent rally and risks that lie ahead for the quarter. Soni also touched upon his views on the likely winners of the next leg of the market rally, and trends in the mutual fund industry.
What is behind the recent optimism in markets globally?
1. How would you rate the earnings season so far? Any negative or positive surprises in the Nifty50 pack?
2. On a broader Nifty50 basis, earnings downgrades in Q1 results season are still not material. But given the recent rally, do you find valuations turning rich again?
3. We have seen banking as a pack seeing strong gains of late. Which sectors do you think can lead the next leg of the rally?
4. Investors globally are expecting the pace of Fed rate hike to slow down. What do you see emerging as a major risk for domestic stock in coming months?
5. What is your view on mid and small cap as a pack? How should one approach this pocket?
6. We are seeing a slew of NFOs being launched, including your own FlexiCap Fund, do you think there is enough liquidity and demand for investments in MFs in the current scenario?
Thank you Mr Soni for the insights.
That’s all in this week’s special podcast. Do keep checking this space for more interesting content and take time out to follow our market podcasts twice every day. Stay safe and Happy Weekend!
(Disclaimer: Recommendations, suggestions, views, and opinions given by the experts are their own. These do not represent the views of Economic Times)