Post Market views - Dec 29, 2020 - Mr. Binod Modi, Head Strategy at Reliance Securities

Domestic indices remained firm and recorded fresh highs today led by sharp rebound in financials. As expected, volatility in the market was high today and barring Financials and IT, most key sectoral indices traded in red. IndusInd Bank, Axis Bank, Tech Mahindra and HDFC were top gainers, while Coal India, NTPC, Nestle and Hindalco were laggards.

Continued buying by FPIs remains a dominant factor for market rally. Given soft monetary policy of global bankers, weak dollar, improved prospects of corporate earnings recovery and consistent improvement in covid-19 recovery rate will continue to remain as key tailwinds for strong FPIs participation in domestic markets in the near to medium term. 3QFY21 earnings report card will be crucial for markets. Nifty looks set to surpass 14000 level shortly. Considering rich valuations and earnings recovery threat emerging from high input prices, investors must focus on companies which have strong earnings potential and sound margins of safety.

Source : Equity Bulls

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