The question bothering the Stock Market Investors still remains - is there more downside left and what is the future of Indian stock market? Most investors are wary of investing in the stock markets at this juncture as they are not sure if the stock markets will crash further. The global scenario is not very positive with the recession in the US looming large.
The following are the questions, CNBC-TV18’s Stocks Editor, Udayan Mukherjee asked the ace investor and market expert Rakesh Jhunjhunwala in a special series called ‘Hunt for the Bottom’.His answers will give you some idea as to where Indian stock markets are headed in the future.
Jhunjhunwala feels that the share markets have seen a bull-run since April 2003 and one cannot have a bull market without corrections. The corrections would be testing the investors’ patience and their sheer belief in the stock markets, he said.
"All the corrections we have had in the last four years have had been deep but they have not been deep time-wise. I think the real patience and the real belief in the equity and in the market comes when the market tests you time-wise. So I think this is going to be one of the deepest and the longest corrections that we are going to have, in what I believe is going to be a very long bull market,” Jhunjhunwala said.
Q: Is the worst over, have we seen most of the pain or do you fear that there could be much more pain this time around?
A: We have not four but four-and-a half-years of bull market, which started in April 2003. Whatever be the quality and depth in the length of the bull market, you are not going to have a bull market without corrections, which are not going to test our patience and sheer belief in the market. All the corrections we have had in the last four years have been deep. They have not been deep time wise. The real patience and belief in equity markets comes when the market tests you timewise. This is going to be one of the deepest and longest corrections that we are going to have. However, this is going to be a very long bull market.
Q: In the middle of this phase, you expect to see some rallies which will get sold into as well?
A: Yes. You will surely see rallies and we are in the midst of one. Suppose the markets doesn’t exceed and the index doesn’t go 21,000 and Nifty doesn’t go above 6,200 for the next 18 months, I as an investor won’t bother it at all. I would happily rest with the kind of gain we have had for the last four-and-a half-years.
Q: It could be an 18 months rest you think?
A: Why not.
Q: Six quarters of market not going above the old high?
A: Why not.
Q: Is it a possibility or a probability according to you?
A: It’s both.
Q: You think it’s a highly likely event?
A: I believe in the long-term story. I am going to profit as an equity investor. As an investor, I don’t see a greater rate of return for my capital at any place other than the equity market. I watch the market everyday but I won’t be surprised. I am prepared for it.
Q: But you look at the screen very carefully as well and trade a bit? Is the screen reflecting any strength over the last few days?
A: A good part of the market has already bottomed. It may take time for the market to gain. In the midcap space, a lot of stocks have bottomed. But the price movement tells me that as of now, not much of the market is going to renew those.
Q: Which sectors are still vulnerable to downside? Some sectors had seen massive excesses, but stocks have also fallen 40-50-60%. Do you think enough correction has happened in those secto |
