Kotak Mahindra Bank CEO Uday Kotak on Wednesday said in a tweet about the gravity of equity markets that every investors should keep in mind.┬а
“GRAVITY! When interest rates are low and central banks are busy printing money, equities can defy gravity. When money gets tighter( QT) and deposits give higher rates, gravity comes back. Every risk investor must be alert to the power of gravity,” tweeted Uday Kotak.┬а
First half of the veteran banker’s tweet referred to the peak stock market euphoria witnessed till last year when central banks across the globe kept interest rates low to spur consumer spending after Covid pandemic battered the global economy.
The latter half of Kotak’s tweet referred to the quantitative tightening actions taken by central banks in 2022 to tamp down on the raging retail inflation. With RBI raising key lending rate to 6.25%, fixed deposits have been giving higher rate of interest rates, which Kotak says might be another headwind for equity markets.┬а
Meanwhile, according to the Kotak Securities Market Outlook 2023, Nifty could touch 20,919 in 2023 in a bull case scenario.┬а
In a base case scenario, Kotak Securities has set Nifty target at 18,717 for 2023, while in a bear case, the Nifty target is set at 16,515.
Domestic equity markets wiped off opening gains and edged lower in Wednesday’s intra-day trade.
Key indices Nifty50 was ┬аdown 200-odd points, whereas the S&P BSE Sensex declined more than 650 points to 61,000-odd level. The BSE benchmark hit a high 62,006 this morning.
Broader markets too fell in trades, the Nifty MidCap 100 and Nifty SmallCap 100 indices were down around 1 per cent.
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