Why I am Bullish about Medium Term for Nifty? | Stocks and Commodities

April 4, 2016
Time: 7.45 am

Why I am Bullish about Medium Term for Nifty?

1. I am taking a bullish view for Nifty in the medium term to long term.
2. First, our economy is still agricultural economy, our economy will do well only if agricultural growth is good.
3. After two years of drought, people are predicting above normal monsoon this year.
4. Not only that, they are expecting well distributed rainfall this year.
5. So FMCG and Two wheeler stocks will be in focus.
6. Tractor manufactures like M&M will also be in focus.
7. Remember M&M did not rise for the last two years.
8. Second is the huge buying by FIIs in Cash markets.
9. Though they have sold for about Rs 19000 crores in January and February, they have bought for Rs 27000 crore in March alone.
10. A similar trend was noticed only in the middle of 2013 but markets continued to rise that time despite most technical people shouting that markets were over bought.
11. Markets can be in the over bought zone for a long period that no technical person will be able to predict.
12. Third, RBI action to clean up the books of the banks.
13. RBI was very firm in cleaning the books by March 2017.
14. Usually markets will discount the things 6 months ahead of the events.
15. If by April 2017 all banks clean up their books and then they are likely to do well after that,
16. But stock markets will rise 6 months ahead, so Banking stocks will lead the next bull run.
17. People like Vijay Mallaya are being forced to repay the loans which is a very positive sign for banks.
18. Remember US markets are near last year March levels but we are nearly 15% lower from March 2015 level.
19. If the bullishness continue, if monsoon is good, surely Nifty will be trading at much higher level than today.
20. I will not be surprised if Nifty tests 9000 by the end of this year.