Bearish on L&T and BHEL: Sharyans Resources

In a chat with ET Now, CK Narayan, President Treasury, Sharyans Resources, shares his trading calls.

What is the call on capital stocks?

Capital goods stocks still do not look too healthy. Larsen & Toubro and BHEL are down significantly. Even at these levels, you are seeing some shorts being covered. For example, today morning L&T saw some buying coming in, but that buying has largely been in the nature of shorts which are being closed or ahead on the IIP numbers. When the IIP numbers came, L&T slid a little again. So, I do not really see fresh buying coming into any of these, and that has been the bane for all the stocks across all the sectors. You are not really seeing any significant new buying coming in. You have a stray buyer who steps in and then that leads to a small domino of shorts closing out their plays. This really does not make for something very healthy or very sustainable on the upside.