Aman Chowhan says market volatility due to profit booking; continues to like private banks

“I would rather play a little bit more carefully at this point of time. We love the price correction happening in some of the counters. That is where probably we will accumulate some of the bigger companies. The medium, small sized companies are relatively more vulnerable to the liquidity-led push in the market. And we are slightly more concerned there.”

PSU bank stocks face Sebi deadline for public shareholding. Compliance by some banks is needed. Analysts are optimistic about growth, profitability in PSU sector, despite challenges. Valuations remain attractive for investors seeking value opportunities in the market.

By Herbert Lash and Naomi Rovnick NEW YORK/LONDON (Reuters) -Global stocks were steady on Wednesday, with European equities outperforming as Italy soothed market nerves about a windfall tax on bank

Without grasping the meaning of personal finance terms and their implications, you cannot effectively earn money or enhance your financial health. Understanding these terms is essential for making decisions about your investment portfolio and actively managing it.

Nifty will likely remain in a range for the next few weeks or even months, while certain sectors such as auto ancillary, sugar, infrastructure, and power will continue to perform well. The banking sector, which was expected to outperform, has turned out to be the weakest sectorSo better avoid most bank stocks, except for select PSU banks and focus on the auto sector, particularly Maruti, Tata Motors, M&M, and TVS Motors.

S Naren says: “Old investors can stay invested but new money coming in should be spread across asset class. We are much more focussed on the fact that new money should be invested more carefully than taking out old money. Old money can just stay invested. I do not think we are going to see 2020 markets or 2021 market levels easily.”

“If you have money which is needed after 10 years plus, then having a slightly higher equity, even to the extent of 80% equity would be good to have in the portfolio. So, look at your asset allocations; five to six years, 65 to 75% equity, if more than that, then you can have 80% equity.”

“Fortunately, in our funds and with our investors, we have kept a significant amount of cash in the portfolio. This kind of a correction brings up the opportunity to buy. We may not buy all at once, but selectively in some of the stocks, we would like to buy in this particular fall.”

Indian equities on Thursday closed in the red with banking stocks taking a massive toll. Sensex erased its psychological mark of 58,000 and Nifty 50 came below the 17,100 level.

After a very short phase of a correction, several PSU bank stocks were the top gainers in Tuesday's trading session. Today on Wednesday they are trading with minor cuts and some of them have seen intraday recovery. This is worth noting for two reasons. First, all PSU banks are sitting with a decent amount of gains for the last five months, and even then they have not witnessed a sharp decline. Second, on Tuesday, the breadth of the market was weak. Suddenly PSU turns into an outperforming set of stocks. It signals a couple of things. First, because the banking sector is probably the best proxy play to the Indian economy. It appears the view on the street is positive on economic growth. Second, rather than taking exposure to an individual sector, taking exposure to PSU banks which are still among the lot that are available at relatively cheaper valuations is a trade on the street. But should one ignore the private banks? Probably not. They have their trajectory and just because they have not performed on the street it does not mean their core business model has some issues.. It's just another phase that shall pass.