Yesterday’s market rally was largely liquidity-driven: Nischal Maheshwari, Edelweiss Securities

In an interview with ET Now, Nischal Maheshwari, EVP Research, Edelweiss Securities Ltd, shares his views on the current market rally. Excerpts:

ET Now: Apart from liquidity, what explains this underlying momentum?

Nischal Maheshwari: Yesterday’s rally was a surprise. The RBI Governor did not say anything substantial which could have prompted the rally. However, a lot of people were waiting on the sidelines, wanting to enter the market since it has held on to higher levels. Since the people were waiting for this policy and as it came as expected, the people jumped in and bought some stocks.

Domestically the people have been underweight on banks for a long time. However, yesterday’s rally was largely driven by banks. There was some initial buying or at least taking up to neutral from underweight positions. It was largely a liquidity-driven rally.