Equity Market Strategy for Budget 2024: Despite the recent sell-off in the Indian equity market following weak signals in global markets due to rising US-China trade war tensions, potential for growth still remains. The Nifty 50 index has fallen by over 125 points, the BSE Sensex has plummeted by around 400 points and the Nifty Bank index has fallen by over 300 points in early morning trade. However, this is not a cause for alarm but rather a strategic investment opportunity.
According to experts, the Indian stock market has witnessed a trend reversal after a sharp sell-off on Friday. Experts said this trend may continue till Tuesday as the market awaits the Union Budget 2024 by the Modi 3.0 government. The Union Budget 2024 is a key event in the fiscal calendar as it outlines the government’s fiscal policy and spending plans for the coming year. Experts said global signals are adverse due to rising tensions in the US-China trade war. Investors can look to companies that have been working on expanding capital expenditure in the last few quarters, they said. The Union Budget is expected to remain a growth-oriented budget, meaning that railways, infrastructure, energy, oil & power, auto and banking are the major segments where such listed companies can be easily found, he said.
Stock Market Strategy for Budget 2024
Presenting his stock market strategy ahead of the Union Budget 2024, Sugandha Sachdeva, Founder, SS WealthStreet, shared his views. His expertise and experience provide a solid foundation for his predictions. He said, “We expect significant reform measures to foster sustainable growth and enhance social welfare with strategic allocations to agriculture, infrastructure, public healthcare, railways, power/renewable energy, real estate, defence, logistics and tourism. Further, we expect restructuring of income tax brackets and an increase in standard deductions in the new tax regime to increase disposable income. Further, measures are expected to be taken to ensure adequate funding for development projects while balancing the fiscal deficit.”
On picking blue chip stocks ahead of Budget 2024, Avinash Gorakshkar, Head of Research, Profitmart Securities said, “One can look at companies that have been ramping up capex and reducing debt. Stocks with no debt and a strong track record of capex are ideal stocks to buy now as the Union Budget is likely to provide impetus to such stocks in the near future.” Gorakshkar said the upcoming budget is expected to remain a growth-oriented budget and hence infrastructure and allied sectors are expected to benefit from such a budget. He said a growth-oriented budget and a healthy state of the national economy are also likely to generate demand in the banking and automobile sectors.
Sugandha Sachdeva expects the market to undergo some correction after the Budget 2024 announcement, saying, “Budget 2024 is poised to address the multifaceted needs of the economy while balancing populist policies and fiscal responsibility. Investors should remain informed, tread carefully and be ready to capitalise on opportunities arising from the Budget announcements while also being mindful of a possible market correction.”
Stocks to buy today
On stocks to buy ahead of the Union Budget 2024, Avinash Gorakshkar said, “In the automobile sector, one can consider buying M&M or Tata Motors, while in the banking sector, SBI, ICICI Bank and Axis Bank would be good options.”
On stocks to buy ahead of the Union Budget 2024 announcement, Sugandha Sachdeva said, “While empirical data suggests that volatility remains high on the budget announcement day, we have identified a few stocks that may see a decline in the short term but are likely to be on an upward trajectory in the medium term.”
Sugandha recommended SBI Card, Oberoi Realty, RITES, KPIT Tech and HBL Power as the following buys.
1]SBI Card: Buy around ₹680-₹685, target ₹840, stop loss ₹595.
2]Oberoi Real Estate: Buy at ₹1570-₹1580, target ₹2050, stop loss ₹1280.
3]RITES: Buy at ₹650-₹660, target ₹880, stop loss ₹520.
4]KPIT Tech: Buy at ₹1690-₹1695, target ₹2080, stop loss ₹1500.
5]HBL Power: Buy at ₹540-₹550, target ₹765, stop loss ₹460.
Infographic: Courtesy of SS WealthStreet
Disclaimer: The views and recommendations expressed above are those of the individual analyst or brokerage firm and not of Mint. We recommend checking with a certified professional before making any investment decisions.
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