Indian stock market: German emerging markets fund manager Mark Mobius expects Sensex to touch the coveted one lakh mark by the end of this year.
“We are now in a long-term bull market, and I see the Sensex index going up to 100,000,” Mobius said while speaking to CNBC TV-18 on Monday, September 30.
However, Mobius added that Sebi’s directives on the derivatives market could temporarily impact the Indian stock market.
“The problem facing India, as Sebi has pointed out recently, is the derivatives becoming too big; there are too many people gambling on derivatives,” he said.
“...we have to watch what measures Sebi is going to take in terms of derivatives; when that happens you will probably see a downturn in the market, just temporary, but you would see a correction in the market. But the measures will not be able to hold back the bull run in Indian stocks, he added.
“I have always said, there will be corrections along the way in India that can be 5-10-15%, so expect that, but be ready to buy when it happens. It is a good idea to hold gold, maybe 10% of the portfolio. One of the reasons for gold's price rise is the Indian buying,” the veteran investor said.
On September 24, Sensex crossed the record-high of 85,000 points for the first time. However, the index gave up this level on Monday amid profit-taking at higher levels.
The Indian benchmark indices took a tumble today, with both the Sensex and the Nifty 50 dipping over a per cent each. The Sensex opened at 85,208.76 and fell by 1.5 per cent to the day's low of 84,257.14. ThNifty 50 fell below the 26,000 mark. The index opened at 26,061.30 and declined 1.5 per cent to a low of 25,794.10 in intra-day trade.
On the IPO boom, Mobius said, “It is not a good idea to pile into IPOs unless you are certain about the business.”
According to him, the most interesting sectors right now are real estate, as demand for housing is going to soar, infrastructure and pharmaceuticals. In terms of emerging sectors, he stated that the semiconductor industry is expected to do well, however, it will take time.
Mobius is hopeful that the 'new bull market' will have a good impact on India and other Asian economies.
