Banking, IT, auto or realty? Which segment stocks to buy in rising Indian stock market?

Stock market strategy: The buzz is that the high interest rate regime will fade out in the near term, as the market is expecting an announcement of a timeline for interest rate cuts at the fast-approaching Jackson Hole Symposium. As stock market investors quietly listen to US Fed Chairman Jerome Powell's speech at the Jackson Hole Symposium, they will be busy scanning various segments and finding value picks to maximise their returns.

According to stock market experts, in the wake of the US Fed rate cut buzz, rate-sensitive segments like banking, IT, auto, realty, etc. are expected to benefit. During Friday deals, realty and IT indices registered over a 2 per cent rally, which is enough to understand the buzz around these segments. However, the situation gets tricky as investors with small ticket sizes may need help finding that much money to invest in all these segments. Instead, such investors want to know which segment may outperform others in an upcoming bull market.

What experts say

Speaking on the segments that may react positively in the wake of US Fed rate cut buzz, Avinash Gorakshkar, Head of Research at Profitmart Securities, said, “As the high interest rate has peaked out and the market is waiting for the beginning of interest rate cut, US Fed rate cut buzz has fueled speculation about the announcement of a timeline for an interest rate cut by US Fed Chief Jerome Powell in his Jackson Hole Symposium speech. That's why the market is betting high on rate-sensitive segments like banking, auto, IT, real estate, etc. So, those who have a medium to long-term perspective are advised to look at value picks from these segments.”

However, those with limited investment funds would like to invest in a segment that can outperform others after the beginning of the interest rate cut.

For such investors, Amit Goel, Co-Founder and Chief Global Strategist at Pace 360, said, "The Real estate industry is probably the best buy whenever central banks turn dovish as this industry is most sensitive to interest rates. The demand for real estate increases when the cost of financing is lower, and the same should happen this time. Also, the company's earnings are worth more when interest rates are lower."

Stocks to buy

When asked about stocks to buy from the real estate segment to maximise one's return in the upcoming bull run, Avinash Gorakshkar of Profitmart Securities said, "If one wants to add real estate stocks to their portfolio, one can look at DLF, Suntecl, Shobha, and Godrej Properties shares."

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