Stock Pick for 2010
The stock market in India is likely to extend its recent rally into 2010 but it is unlikely to repeat 2009's spectacular rise. It is expected that the Indian economy will do well as well the corporate earnings will do well but one shouldn't expect the market to rise sharply as was seen last year. The market will look forward to several issues that may dent the upward momentum. Issues like withdrawal of stimulus measures, bad monsoon, direct tax code implementation (as per the draft code) may pose an upper cap on the indices. But undoubtedly these issues won’t hamper the long term bull market trend and it will march ahead in the long term. 2010 may not see a new high but there is high possibility of market crossing 20000 mark this year.
One has to be cautiously optimistic while picking stocks keeping in mind the recent market mayhem which taught every investors and traders that only companies with good fundamentals, strong balance sheet with low debt component and strong order book has only been able to withstand and overcome the crisis. One has to keenly watch the Government policy and their disinvestment decisions.
PSU stock will be the flavour of the season if the Government fulfills the promises. PSU stocks has already rallied to a great extent and one must not jump into any such stocks without judging the valuations else there will be high chance of burning their fingers. Midcap PSU bank stocks like Dena Bank, Uco Bank, Indian Overseas Bank, Allahabad Bank, Central Bank still have some steam left in them and if Q3 and Q4 results are promising they may rally further. NTPC, REC, BHEL, BEL are some good long term pick among the PSU arena.
Telecom is expected to under-perform the bourses in the medium term and any correction sooner or later will bring those stocks at attractive buy levels for a long-term investment decision. Bharti, Rcom and Idea should be keenly watched as a value pick for long-term investment only after decent correction.
Power and infrastructure will continue to do well despite high valuations among front liners. LT, CESC one must closely watch and can be bought on every dip with good potentiality of appreciation.
And last but not least, Reliance Industries must not be overlooked and it must be noted that despite its gas dispute issue it has all quality to give decent returns and must form a part of a long term portfolio.
Happy Investing!
By TheStockWorld.com
DISCLAIMER: The Stock Trading Calls/Investment ideas by Thestockworld.Com and Group Companies associated with it should not be construed as an offer to buy or sell securities, nor advice to do so and are for information purposes only and under no circumstances should be used for actual trading. You agree to assume complete and full responsibility for the outcomes of all trading decisions that you make on the basis of above trading calls, including but not limited to loss of capital. Consult a qualified financial advisor before making any trading/investment decisions.
Wednesday, January 20, 2010
Wednesday, January 6, 2010
INDIAN STOCK MARKET IN 2010
INDIAN STOCK MARKET IN 2010
The prevailing economic conditions, both domestic and global, suggest the Indian stock market is poised to continue to rally in 2010 even though US and European Markets have yet to recover from recession effect. Key factor remains the impact of Q4 results and strong GDP growth of around 8%. However point of caution needs to be the phase wise withdrawal of financial support given by Indian government to the market.
So far, the recovery in India has been driven by domestic consumption and government expenditure. However, corporate investment is expected to surge in 2010 due to the strong GDP growth which will increase capacity utilisation. Stocks in the infrastructure and power sectors may be the front runners in 2010 as they receive strong policy support from the Indian government. But one must be cautious that the interest rate cycle might start moving up with the strong GDP performance and relatively high inflation. If it does, banking stocks will be affected severely as was seen in the past.
We have witnessed a global financial crisis in 2008-09 which is still very much an unforgettable incident and taught us good lessons. During the bull rally (2003-2007) there was considerable exuberance. This was the time when interest rates were low. Credit was available and that too cheaply. Not just that, corporate profits were growing at a healthy rate. Stock markets were notching strong gains. But the global credit crisis changed all that. The abundant liquidity, not surprisingly, led to asset bubbles that finally burst. So if one learned a good lesson should go for companies with less debt, enough cash and strong return ratios. These are the ones who will be able to tide over the crisis and generate strong returns to shareholders in the long term beyond 2010.
Happy Investing!
Stock to watch out for in 2010: Larsen & Toubro, BHEL, CESC, Dena Bank, Karnataka Bank, Indian Overseas Bank.
By TheStockWorld.com
DISCLAIMER: The Stock Trading Calls by Thestockworld.Com and Group Companies associated with it should not be construed as an offer to buy or sell securities, nor advice to do so and are for information purposes only and under no circumstances should be used for actual trading. You agree to assume complete and full responsibility for the outcomes of all trading decisions that you make on the basis of above trading calls, including but not limited to loss of capital. Consult a qualified financial advisor before making any trading decisions.
The prevailing economic conditions, both domestic and global, suggest the Indian stock market is poised to continue to rally in 2010 even though US and European Markets have yet to recover from recession effect. Key factor remains the impact of Q4 results and strong GDP growth of around 8%. However point of caution needs to be the phase wise withdrawal of financial support given by Indian government to the market.
So far, the recovery in India has been driven by domestic consumption and government expenditure. However, corporate investment is expected to surge in 2010 due to the strong GDP growth which will increase capacity utilisation. Stocks in the infrastructure and power sectors may be the front runners in 2010 as they receive strong policy support from the Indian government. But one must be cautious that the interest rate cycle might start moving up with the strong GDP performance and relatively high inflation. If it does, banking stocks will be affected severely as was seen in the past.
We have witnessed a global financial crisis in 2008-09 which is still very much an unforgettable incident and taught us good lessons. During the bull rally (2003-2007) there was considerable exuberance. This was the time when interest rates were low. Credit was available and that too cheaply. Not just that, corporate profits were growing at a healthy rate. Stock markets were notching strong gains. But the global credit crisis changed all that. The abundant liquidity, not surprisingly, led to asset bubbles that finally burst. So if one learned a good lesson should go for companies with less debt, enough cash and strong return ratios. These are the ones who will be able to tide over the crisis and generate strong returns to shareholders in the long term beyond 2010.
Happy Investing!
Stock to watch out for in 2010: Larsen & Toubro, BHEL, CESC, Dena Bank, Karnataka Bank, Indian Overseas Bank.
By TheStockWorld.com
DISCLAIMER: The Stock Trading Calls by Thestockworld.Com and Group Companies associated with it should not be construed as an offer to buy or sell securities, nor advice to do so and are for information purposes only and under no circumstances should be used for actual trading. You agree to assume complete and full responsibility for the outcomes of all trading decisions that you make on the basis of above trading calls, including but not limited to loss of capital. Consult a qualified financial advisor before making any trading decisions.
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