Earnings uptick crucial for Nifty to cross 26,000 levels: Ambareesh Baliga

The market saw a brief surge following the government’s GST rate rationalization, but experts say the rally may not have lasting momentum as expectations had already been priced in.

Ambareesh Baliga, market analyst, attributed the short-lived rally to built-up expectations following the Prime Minister’s Independence Day speech.

“See, this rally which we saw was short lived basically because the expectations were clearly built up post PM's independence day speech and whatever came out was not very different from what people were expecting and markets had rallied in between based on those hopes. So basically, it is buy on hope or buy on rumour and sell on news, that is what has happened. But then clearly, the markets have seen the intermediate bottom, so I really do not see the markets going below those levels of 24,200, 21,300. On the upside we would be more or less capped at closer to 26,000 levels because unless, of course, we see the earnings uptick majorly coming in, I really do not see the markets crossing those 26,000 levels."



"So, broadly if we are talking of the next couple of months, we should be in this broad band of 2,000 points of Nifty. And when we are talking of the GST cut, yes, this will spur consumption going ahead and especially we are looking at the festive season and normally we see during festive seasons the consumption moves up, so this would be a booster for that and it has been across various segments. So, from a consumption angle, yes, it was a very-very positive announcement.”

Baliga also shared his insights on the mobile manufacturing sector and semiconductor companies in the wake of global trade developments, including recent remarks by former US President Donald Trump regarding tariffs.

“See, semiconductors again is a very long-term story so irrespective of whatever tariffs he puts right now, I do not think it is going to affect us at all because we are just at the beginning of mean manufacturing semiconductors, so we have a long way to go. So, I am not really bothered about that and as far as we are talking of the third party manufacturing which is being done by people like Dixon, that again may not really get affected much because there is a decent amount of sales which happens outside US and these facilities will continue providing the models which are meant for other than US.”

As India heads into the festive season, market experts believe consumption-driven sectors may see a boost, while broader market indices are expected to trade within defined ranges until more substantial earnings triggers emerge.