A pre-election rally in the stock market is on the cards with the Nifty expected to advance to 23,400 by June, and investors should use the current volatility as an opportunity to buy on dips, said brokerage ICICI Securities in a note.
ICICI Sec expects Nifty to form a ‘durable bottom’ in the February-March period wherein 20,500-20,800 levels could be a strong support. “Usual bull market corrections in Nifty are around 8% (multiple cycle average) followed by new highs,” the report said. “Volatility from hereon should be embraced as a buying opportunity.”
The brokerage expects, PSU stocks, IT, Power, capital goods, metals and BSE PSU stocks to outperform in the run up to elections.
ICICI Securities also said that the ratio of Nifty to Nifty500 is at the bottom of the cycle. “Over two decades, this ratio bottomed out at 1 on two occasions, followed by large-caps performing in subsequent quarters.”
First Published: Feb 06 2024 | 12:04 PM IST