Consolidation is visible in the stock market for the last four months, especially since October. Marken touched an all-time high in October last year. The consolidation may continue for the next two months. This is to say of Harshad Chetanwala, co-founder of MyWealthGrowth. On Friday also the Sensex fell more than 900 points.
Generally, the performance of the stock market remains weak when the interest rate rises, he said. Interest rates are rising all over the world right now. He said that in such a situation, investors need to make new investments gradually instead of lump-sum. He talks openly about stock markets with Moneycontrol. Here are the highlights of the interview.
When is the stock market expected to return to record highs?
The market is well positioned for long-term growth. Its performance is expected to improve after the consolidation continues for some time. Especially the increase in interest rate and Ukraine-Russia issue is affecting it. This phase can continue for about two months. After that the market is expected to bounce back.
Do you think crude oil prices will remain at $90 a barrel for a long time?
The factors affecting commodity prices are different. A year ago, no one expected crude prices to rise to this level. Actually, the demand for crude is increasing in the post-Corona situation. On the other hand, there have been issues related to supply for some time now. Tensions are rising between the US and Russia over Ukraine. If Ukraine-Russia tensions escalate, crude prices will remain under pressure. If the conflict between the two countries decreases, the pressure on crude prices will decrease significantly.
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What would you say about RBI’s monetary policy?
RBI has surprised the market by not making any changes in the rates. He has said that his focus remains on Grot. Keeping the optimistic stance consistent means it will continue to focus on recovery while maintaining a low interest rate. But, we expect interest rates in India and around the world to rise this year.
What are your views on the December quarter results of the companies that have come out so far?
The results so far have been good. Revenue growth has been good. Also, there has been very little disappointment on the operating margin front. Inputs cost has been high during the December quarter, which has impacted the profits of the companies. The impact of higher input costs will be visible on operating margins for some more time. We believe that profit growth will continue in the coming quarters as the pressure on margins eases.
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