Traders may show interest in stocks such as BPCL, SBI and Tata Power which have traded below two standard deviations and offer favourable risk-reward.
Global automobile stocks have fallen 10-20% over the past three months amid rising concerns about stagnation in the US car market.
US investors pared their exposure to emerging market funds in 2015 but recent outperformance and change in outlook may have led them to rethink their strategies.
The share of investments of exchange trade funds in India’s equity markets has increased to 27% in the past four weeks compared with an average investment of nearly 10% in the total foreign assets.
The rationale for selecting these companies is that they may dole out a higher interim dividend in the next few days to save the tax bill for the promoters.
The chinks in the assumption of high double-digit growth for the passenger vehicles (PV) in next fiscal year appears to be turning into the cracks.
Investors are swarming to chase few stocks which have been defying gravity, showing earnings growth in a growth starve world.
The underperformance is likely to continue given the relatively higher implied Return on equity (RoE) amid downgrades in expected earnings per share.
Indian stocks dropped by 23% from its January 2015 highs and joined the bandwagon of the market such as Japan, Germany, China and UK.
Amid concerns over slowing China and soft oil prices, investors across markets are buying safe haven assets like sovereign bonds and gold.
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