Market to open weak on Monday; HDFC Bank, HCL Tech among 4 stocks to buy on dips: Yash Gupta

In an interview with ETMarkets, Gupta said: “Monday again we will see some pressure on the indices as the US inflation figures announced on Friday were above market expectation and the US market reacted negatively,” Edited excerpts:

Market remained volatile in the week gone by where the bears had an upper hand. What led to the price action?
We continue to see volatility in the market on the back of global as well as domestic developments. In India, RBI has taken a rate hike of 50 bps despite last month’s 40 bps in an off-the-scheduled meeting.

Inflation remains a concern for the US as well as India. The RBI has already increased the expected inflation for FY 2023 to 6.7% and that 6.7% is on the assumption of crude oil prices being at $105, but currently it is trading at $122.

Along with all these issues, FII selling continues which has kept the market under pressure. Domestic institutional investors (DIIs) have come to the rescue but are not able to combat the FII selling pressure.

Both Sensex and Nifty50 breached crucial support levels in the week gone by. How are indices likely to trade in the coming week?
Monday again we will see some pressure on the indices as the US inflation figures announced on Friday were above the market expectation and the US market reacted negatively.

We expect a negative start to the market and after that, we expect some consolidation.

Consumer durable, as well as FMCG sectors, saw some selling pressure. Is inflation denting the appeal for consumer names? Do you see further pressure?
For consumer & FMCG companies, the last couple of quarters have been very difficult due to commodity-led inflation; companies have taken price hikes but still, gross margins are under pressure.

We believe that the consumer and FMCG sectors will continue to remain under pressure for the next one quarter.

We have a big US Fed meeting coming up next week. Should investors trade cautiously or the volatility can be used to go long?
US inflation hit 40-year high, consumer price index hit 8.6%. Coming quarters will be very challenging for the US Fed because there are no signs of cooling off of inflation. We expect a volatile market in the coming week as we will see a rate hike.

Where is value emerging in these markets? Any stocks on your radar that are looking for good buy-on dips stocks?

We suggest investors to be cautious in the market and deploy their capital on a proportionate basis.

List of stocks for buying on dips

1.

– Target 120

2. – Target 1000

3. – Target 1750

4. – Target 1348

(Disclaimer: Recommendations, suggestions, views, and opinions given by the experts are their own. These do not represent the views of Economic Times)