D-Street takes lesson from crash, says stay light for now, use guerrilla tactics in shorts

NEW DELHI: Domestic equities fell more than 1.5 per cent on Friday, tracking losses in Asian markets, amid fears that incoming US President Donald Trump’s policies would be inflationary, leading to higher US interest rates, which will dent the appeal of emerging market assets.

The rupee fell to 67.0400 against the dollar from previous close of 66.6250. During the day, the domestic currency fell as low as 67.2000, which is its lowest since August 29.

Dalal Street veterans and analysts reacted to the market crash with ease, with some saying it is a good opportunity for long-term investors to pick up quality stocks.

Sanjiv Bhasin, EVP-Markets, IIFL
The rise in US bond yields impacted global markets on Friday. In India, selling by foreign institutional investors dampened market sentiments. After the correction, this the best time to invest in blue chip counters.

Pankaj Pandey, Head of Research, ICICI Securities
The S&P BSE Sensex slipped over 700 points in intraday trade, amid expectations that consumption could slow down a bit after the government step to demonetise Rs 500 and Rs 1,000 currency notes. In the short term, we could see a slowdown in the growth rate. After the fall, it is time to buy quality stocks. The rise in US bond yield somehow dampened sentiments, but I think rate hike in the US will not be that much. I am bullish on the blue chip counters.

CK Narayan, Founder, Chart Advise
The kind of rally we saw on Thursday from that low was so swift that people could not really participate in it. But having seen the market come back from prior declines, I think everybody turned a slight bit complacent and went long at higher levels believing that the market was Teflon-coating and could not go further down. Next week is going to be a difficult week for market. I would suggest investors to stay light, particularly on long positions and take some guerrilla tactics for trading on the short side.

Karthikraj Lakshmanan, BNP Paribas Mutual Fund
Weakness prevailed in the markets on Friday as key benchmark indices in India succumbed to selling pressure. A sudden spike in US bond yields to a 10 – month high, rattled investors in emerging markets like India. There were concerns that policies under the new government, will stoke inflation and inflation rates in the US, thereby sparking capital outflows from emerging markets.

Jimeet Modi, CEO, SAMCO Securities
Market has entered a long phase of corrective pattern trying to correct the entire rise from the March bottoms. Market hit the 50 per cent retracement mark at 8,000 Nifty level intraday mid week but closed substantially higher. 8,000 levels in Nifty, now, therefore will act as a solid support for the market on the lower side. However a 38 per cent retracement level which comes to 8,200 could also act as a minor support. Traders should refrain from creating long positions and Investors should stay on the side lines till a capitulation in the correction is reached.