The bears are in control and they are taking cues from the pandemic with the cases rising and vaccination shortages playing out. Will the sentiment continue to remain soft for quite some time or is this a flash in the pan?
After a long time, we have seen bears in the front seat and we have been hammered across the globe. The banking stocks have been in the front seat of late and they have been hammered more. The Bank Nifty is down 5% and the most affected are the banks. One obvious question is whether the lockdown is going to go higher and higher from these levels. But the silver lining is the way the vaccine situation is resolving. The shortages are being taken care of.
But the banking sector might underperform. But the correction also allows one to participate in the market. The bounce back has not been very fast but one should participate. I do not think the pace of the recovery in the economy, which we have seen in the last six months, can get slower unless we see a nation-wide lockdown.
Do you think, one should buy IT stocks in this decline?
Definitely two sectors which are clear winners are IT and pharma. The IT numbers should be good this quarter as well. We have already seen last quarter’s numbers and the commentary from the management. This quarter’s numbers should also be very good for the IT pack as a whole. One should look at buying IT stocks in this selloff.
