Budget 2024: These are three sectors of opportunities in Indian stock market, says Religare Broking

Budget 2024: Markets are scaling new highs with the benchmark indices - Sensex and Nifty 50 - rebounding significantly in last couple of weeks, after the volatility related to Lok Sabha poll results 2024 cooled down. Gurpreet Sidana CEO of Religare Broking, in an interview with Mint's Ujjval Jauhari, said that the uncertainties are behind and market participants are ignoring all sets of bad news. Here are edited excerpts from that interview:

Q1 FY25 results along with budget announcements to give markets direction

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Post Lok Sabha Elections 2024, investors are looking at the budgets and hopes are that budget should bring in some cheer to the market. 

But other than the budget it is the quarterly earnings performances too, which is likely to start being announced in the next few weeks, and will remain crucial. Market will be searching for triggers. The participants will be taking cues from Q1 results along with the budget.

The markets are not pretty cheap right now. Markets, however, are never appropriately priced. When we say it's not cheap, it's difficult to say if they are expensive because expensive is all subjective, said Sidana . If the corporate results really don't show any negative surprises I think that market valuations can sustain . Also how much more markets can rise will also depend on how the corporate earnings pan out.

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Pockets of opportunities in the markets

It is the banks and banking space as a whole which Sidana expects will continue to do well. Railways, Defence, etc. will also remain in focus.

Interest Rate cuts expectations

We don't know when interest rates may start coming down though everybody has their opinion, pointed Sidana. Nevertheless rise in interest rates started with hikes by the US Federal Reserve and will start coming down as and when the US Fed cuts the interest rates. There is expectation of one rate cut in US in this current year and only once that happens, India interest rates may also start coming down. Indian Central bank will follow footsteps only once that global trends will start easing . However the Indian Interest rates did not go up as aggressively and as fast as the US and other global economies, so decline will also be gradual only. 

FII Flows inflows will also follow the interest rate cuts, Sidana expects the FPI flows to pick pace during Pre Diwali period or close to Diwali. However, for now expects Q1 results to be important to give direction to the markets and justify the market valuations.

Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint. We advise investors to check with certified experts before taking any investment decisions