Mumbai: It was the first bad weekly close for the Indian equity market in 2012. The past seven weeks have seen positive rallies. The market fell more than 2 per cent during this week while it rallied 18-20 per cent in the previous seven weeks helped by inflow of around Rs 29,000 crore.
The fall witnessed in the last three sessions of the week may be due to large money flow toward the MCX IPO which got oversubscribed 43 times till 3 pm today. Experts feel that people may have sold shares to apply for this IPO as investors are seeing a quality IPO after more than a year. Other reasons may be profit booking, rising crude oil prices and tepid economic growth in eurozone.
The 30-share BSE Sensex fell 154.93 points or 0.86 per cent, to close at 17,923.57, weighed down by banks, capital goods, oil & gas and realty stocks. Meanwhile, the 50-share NSE Nifty dropped 54 points or 0.98 per cent to 5,429.30.
Even after this fall, however, experts are still bullish on the market as they expect huge inflow of money in near term.
Varun Goel, Head - PMS, Karvy Private Wealth said he would not be worried too much by a 5-6 per cent kind of correction.
"Valuationwise the market is still trading around 13.5-14 times on FY13 earnings. There seems to be ample liquidity in the global financial system. There is a new LTRO which is coming up on February 29. We expect another Euro 300-400 million of liquidity to be provided to the European banking system. Domestically, we see the monetary policy easing towards the course of the year and by October-November markets will start discounting FY14 earnings also. So overall the prospects for equity for this year look extremely bright and we would continue to be bullish on the markets," he reasoned.
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