✍️ Nuvama Asset Mgmt : Market Outlook

✅ Market Resilience: Despite $25 billion of selling, markets are only down 10-12%, which is seen as a positive outcome.
✅ FII Positioning: FII positioning is at a 15-year low, indicating potential for a swift market recovery if FIIs start covering their short positions.
✅ Earnings Outlook: Rupee depreciation has provided a natural cushion to earnings, reducing the risk of significant downgrades.
✅ Management Commentary: Positive management commentary in IT and Pharma sectors is driving stock reactions, suggesting potential growth.
✅ OMCs Potential: OMCs could see significant upside if crude oil prices stabilize and subsidies are provided in the budget.

⚠️ But, Watch Out For:

❎ Market Volatility: The market has seen heightened volatility, with significant moves in IT stocks and other sectors.
❎ Crude Oil Concerns: Rising crude oil prices have caused nervousness in the market, particularly affecting OMCs.
❎ Specialty Chemicals: There is still pressure on margins in the agrochemical space, making it less attractive for investment.

💡 Guidance:

🎯 Market Range: The Nifty is expected to trade in the range of 23,000 to 25,000 over the next 6-7 months.
🎯 Geopolitical Clarity: Market direction will become clearer in the next 7-10 days, depending on geopolitical developments, particularly related to U.S. tariffs.
🎯 Trading Strategy: Investors should expect a trading range of +10% to -10% in IT stocks and consider OMCs for potential upside if crude prices stabilize.

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