Restraint can be a good measure for Indian stocks, say strategists: Poll

According to equity strategists in a Reuters poll who mentioned worries about the under way economic slowdown and weak corporate earnings, its improbable for the Indian stock to recover their recent losses, but it will definitely rise over the coming years.

The Sensex index will gain 2% to 38,400 by end-2019 from Tuesday’s close of 37,641.27, shown by the poll of over 50 strategists taken over the past week.It is then expected to rise to 39,800 by end-June 2020 and remain around that level to end-2020, a downgrade from predictions made three months ago.According to the latest poll, over half of 42 respondents who answered a further question said Indian stocks would likely increase between 1-10% over the coming six months, while 2 respondents said they would jump over 10%

According to the Foreign Portfolio Investors’ (FPI) data, since the July 5 union budget declaration, international investors have turned net sellers of Indian assets after being net buyers until then from February.

Sher Mehta, the director of macroeconomic research and econometric at Virtuoso Economics said,” a further decline in global growth and broadening of trade related disputes over the coming months is probable to have downside implication for Indian stock markets, as investors will prefer safe havens.”

The announcement made by the government will have a significant effect on opinion of both the domestic and international investors and is likely to arrest the fall in equity, noted Vinay Khattar, head of research at Edelweiss.

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