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Near-term outlook is positive, say investors

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‘GDP number will add to confidence’

Market participants are bullish on the near-term outlook for the market as the latest GDP — gross domestic product — growth rate of 6.3% reversed the slide registered in the previous five quarters. Incidentally, the June quarter growth rate of 5.7% was the lowest in three years. “The market will certainly get confidence from the latest GDP numbers and will lift investor sentiments,” said Aashish Sommaiyaa, MD and CEO, Motilal Oswal Asset Management Company.

“The markets look at a series of data and already there were signals that we have turned the corner. This latest data confirms the view,” he added.

Arun Thukral, MD and CEO, Axis Securities believes that the GDP number indicates that the economy is out of woods and a trend reversal is in place.

Sensex, Nifty

Incidentally, benchmark equity indices lost more than 1% on Thursday as a combination of factors, including global weakness, expiry of derivative contracts and widening fiscal deficit dampened investor sentiments.

The 30-share Sensex lost 453.41 points or 1.35% to close at 33,149.35 as all but two stocks in the index lost ground. Banking majors like State Bank of India, ICICI Bank, Axis Bank and Kotak Mahindra Bank along with Tata Motors, Reliance Industries, Wipro all lost more than 2% each. The broader Nifty of the National Stock Exchange (NSE) closed at 10,226.55, down 134.75 points or 1.30%.

Elsewhere in Asia, leading indices including Hang Seng, Kospi and Taiwan’s TSEC all ended in the red on Thursday. In India, more than 1,400 stocks declined on BSE against 1,207 gainers.

“... We are positive on markets in general and have pencilled-in mid-teens earnings growth for FY17 to FY19 with the majority of gains coming in FY19,” he said, adding the trend reversal has been confirmed by the corporate results for the second quarter as also the fact that managements of various companies are confident of better growth prospects in the second half.

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Printable version | Dec 14, 2019 10:23:02 PM | https://www.thehindu.com/business/markets/near-term-outlook-is-positive-say-investors/article21235811.ece

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