IGI Logo

"The participation of large-cap bluechips across sectors has been giving strength to the rally which has taken the Nifty well above 21000 level. The fact that the fairly valued banking segment has been a significant contributor to the  recent rally also is a positive development. PSU banks like BoB, Canara Bank and Indian Bank are even now attractively valued.

The important question is: will the buy on dips strategy, which has worked well so far, work again from the present level? The risks are high. There is a ‘triple danger’ looming over markets in the near-term: dollar index above 105, steadily rising US 10-year bond now around 4.39% and the Brent crude above $94. These are significant macro risks which the market cannot ignore for long. FIIs refraining from big selling is because of the FOMO (fear of missing out) factor.

Investors should exercise caution, particularly in the over-heated mid-and small-cap segments. Safety is in large-caps."

Above views are of the author and not of the website kindly read disclaimer