Stay braced for sudden corrections

The Indian indices have hit all-time highs in the New Year and the sentiment remains strong. All valuations are also at extremely high levels

January is an important month in several ways. Foreign Portfolio Investors (FPI) tend to formulate their broad global strategy and projections. It’s also when Q3 corporate results will start coming. Since the Budget has been advanced to February 1, a huge number of rumours are being clustered.

In terms of consensus, FPIs seem broadly optimistic about the global economy and about an acceleration of India’s growth rates. Most are expecting moderate capital gains from the Indian stock market with appreciation of about 10 per cent for the Nifty/Sensex pair.

The Budget will be a tight balancing act, on the basis