Sensex up; Friday the 13th may decide medium term direction

Bank (up 7.3 per cent) and Bank of Baroda (5.9 per cent). Even big public sector banks SBI and PNB rode the banking wave, rising 4.3 per cent and 3.8 per cent respectively. Friday April 13 may be the turning point in the market, according to experts. That’s when the results of Infosys will to be announced, from which the technology and communications sector (which comprises 30 per cent of the Sensex weightage) will take their cues. This will also factor in the impact of the rupee appreciation and export sensitivity. The rest of the market is expected to follow. The market will move in accordance with the Q4 results, says AnandRathi director (research) Tarun Sisodia, “The results are expected to be extremely good. I expect Sensex companies to clock an average profits growth of 34 per cent this quarter.” What has led to the current volatility is the anticipation of the impact of interest rate hikes and the expectation of an adverse impact on corporate profitability.” Sisodia adds, “Now that the corrections have happened, it may be time to enter the market as the fundamentals look strong.” Following the Q4 results, valuations are expected to improve — the PE multiple of the Sensex is expected to fall from 20.5 to around 19 or thereabouts.

Says DSP Merrill Lynch Mutual Fund senior vice-president (equities) S N Lahiri, “Globally, equities are doing well, particularly in the emerging markets. Our market, which has not done well in the recent past, is now trying to catch up. The recent correction has brought stocks prices down and, going forward, stock prices will reflect the available fundamentals.”