World equity markets show mixed performance last week. Barring India, most of the Asian indices witnessed selling pressures. Ahead of the election results next Friday, the benchmark indices scaled up to new all-time highs. Most of the sectoral indices ended in positive territory for the week with banking, oil & gas and CG being the biggest gainers. IT and Pharmaceuticals were losers for the week. As we are reaching to judgment day (election results) and crucial macro-economic data would also be declared this week along with few key earning so we could see increase in volatility. The equity markets are looking at a stable government with a clear focus on the reforms process. Next week, markets are expected to trade in a range of 7100-6600.
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| Elite Wealth Advisors Ltd. Market Overview |
Markets after Election
If NDA emerges as a single largest party and almost got the required numbers, it could provide stability in the equity markets. Election results may affect the market in the shorter term (Where we could see 7-10% upside from current levels), ultimately fundamentals will drive them. Q4 earnings are showing signs of improvement and if RBI cuts policy rate in coming months coupled with stable government, we could see earnings upgrades and in these scenario markets can deliver at least 25-28% return in next 2 years.
• Our suggestion is to take long positions in Infrastructure and Oil & Gas stocks for long term horizon as there are lots of opportunities.
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