Indian companies are reporting strong earnings growth. Metals and oil & gas sectors are leading the charge. Even excluding these, growth remains robust. Auto, capital goods, NBFCs, and PSU banks are showing healthy gains. Smallcaps are also recovering. Despite this, market sentiment is cautious, particularly for mid and smallcap stocks. Investors need to be selective.
Fixed income investors should recalibrate strategies as RBI nears the end of its rate-cut cycle. With comfortable liquidity and low rate hike probability, short-term AAA corporate bonds above 7% offer better risk-reward. Accrual-oriented strategies in the short to medium segment are favored over long-duration bets. Potential Bloomberg index inclusion could boost government bonds.
Markets are entering a discerning phase, shifting from narratives to performance. Investors are cautioned against chasing high-P/E small and mid-caps without earnings visibility, as multiple compression is likely. India's medium-term outlook remains constructive, driven by earnings delivery, global liquidity, and FII flows.
In the Nifty 500 pack, the closing prices of 20 stocks fell below their 200-day moving averages on February 13, according to StockEdge.com's technical scan data. Of these, we have highlighted 11 stocks that slipped by about 2% or more. Trading below the 200 DMA is considered a negative signal as it indicates that the stock's price is below its long-term trend line. The 200 DMA is used as a key indicator by traders to determine the overall trend in a particular stock. Take a look:
