“Nifty to be range-bound for next couple of months,” says Sunil Singhania, founder, Abakkus Asset Manager

The Nifty would be more or less range bound between 16,800-17,500 points for the next couple of months, before we decisively start to see stabilisation, says Sunil Singhania, Founder, Abakkus Asset Manager LLP.

“Volatility is going to be the order of the day, but given that earnings are expected to be strong based on a good festive season that India is heading into, and also the fact that income levels both in rural and urban India have been pretty decent, things should bode well”, Singhania said in a conversation with Udayan Mukherjee, Global Business Editor, Business Today.

Singhania added that commodity price pressures are easing and some of the headwinds would start to ease off by September, providing for buying opportunities.

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The ace market veteran is optimistic about the financial sector. “I think the larger banks look pretty decent, and are select NBFC’s,” he asserted.

“At some point in time, the IT sector would improve in terms of returns. It has underperformed for a long time, so maybe that can be a sort of a dark horse. But, I think the bigger play would be from some of the companies and sectors which will benefit from the festive demand,” Singhania added.

According to Singhania, there are positive indications of a return of foreign funds to the Indian markets. “I believe that $ 6-7 billion (outflow) which we have seen in August is not going to be every month. It has to come back to reasonable levels, but I would still be in the camp which believes that every year India would receive net inflows – not only of FDI but even FPI’s. There is absolutely no doubt about it.”