The market has had a difficult run in September with Sensex falling more than 2,500 points from the record high touched on August 28 on the back of IL&FS-led liquidity crisis fears, rupee volatility and rising crude oil prices.
Current fall is like a flashback of Lehman crisis when the mutual fund industry was freezing.
Currently, it is negative all around due to the IL&FS saga which defaulted on seven repayments between September 12 and September 27 to bondholders. We hope these repercussions do not extend to the equity market,
Liquidity fears due to IL&FS created a ruckus in the NBFC space as leading stocks tanked 15-60 percent in September
While answering questions on loss to equity investors in the last one month, Sonthalia said redemption in mutual funds are still higher but gross inflows are still more than the redemption.
Overall gross inflows dried up altogether as there is no fresh subscription to bonds, he added.
I don't see positive equity return for the next three months unless something dramatic happens. Cash is king now, better to stay on sidelines and watch the situation,
IT, Pharma and many other export sectors are better bets right now as at the end, it is all about relative returns. Export sector is less risky than domestic players
He feels there are near-term valuations concerns currently. "If one has to lose capital, it would be in high-quality names rather than small ones but when the market starts recovering then these quality stocks would run faster than smaller ones
No comments:
Post a Comment