On a full-year basis 18k remains the target for the Sensex: Saurabh Mukherjea, Ambit Capital

In a chat with ET Now, Saurabh Mukherjea, Head of Equities, Ambit Capital shares his views about the market outlook for 2012.

ET Now: Volatility and bad news dominated the year 2011. What will dominate 2012, nervousness or some surprise on the upside?

Saurabh Mukherjea: For the first 60-90 days of the calendar year, we have a very scary ride ahead of us. Scary ride for the first 60-90 days partly because of the earnings season in India, partly because of the policy and political situation in Delhi but largely because there is a lot of heavy sovereign debt issuance coming up in Europe. Nearly $250 billion of the fresh sovereign debt is coming on-stream in Europe over the next 60 days. There are question marks as to what interest rates those bonds would be placed at. There is also a big recapitalisation exercise underway for European banks, so the first 60-90 days of the year look to be very hairy. 14500 target for the Sensex remains in place for this period. Beyond that from March-April onwards, we see the situation normalising for India. We see the market normalising somewhat and on a full-year basis 18000 for the Sensex comes back into play.