25 Nov , 2021 By : Kanchan Joshi
Equity markets witnessed correction from the October 2021 all-time highs, , after seeing an unprecedented rally since last year. BSE Sensex has fallen over 3,000 points in a month from its record high mark of over 61,500 to currently hovering around over 58,500 level.
Though, Indian stock markets have been one of the best performing markets compared to its global peers this calendar year despite the recent correction.
Brokerage and research firm ICICI Securities remains optimistic on the Indian equity market, in general, and believes the structurally rally will continue amid intermittent periods of minor corrections and periods of consolidation. Historically, markets have seen correction of 10-15% almost every year.
“The recent correction was overdue and should be construed as healthy in the overall larger uptrend. It is difficult and actually a futile exercise to predict whether the market will correct further or will recover from current levels itself. In general, a 5% correction is a good enough “dip" to follow the time and tested “buy on dips" allocation strategy. Investors may therefore allocate some lumpsum amount at current levels apart from their regular SIPs," the note stated.
Moreover, India has been the preferred destination of foreign investors with inflows touching an all-time high signifying improvement in market sentiment and brokerage house ICICI Securities believes it will continue going forwards as well.
“Structurally, our view remains bullish on the Indian equities. However, in the near term, there are signs of some exhaustion in the equity rally. The markets are certainly taking a pause and the correction could extend by another 5%. On the broader perspective, we reiterate our bullish stance, with our positive rationale very much in place. We see Nifty during 2022 at much higher levels than 2021," said Amar Ambani, Head – Institutional Equities, Yes Securities.