Mutual funds, which were net buyers to the tune of Rs 1,412 crore in July, showed a preference for private banks, infrastructure and oil exploration companies. According to data compiled by Value Research, a mutual fund research company, among the most favoured stocks were HDFC Bank (Rs 339 crore), Cairn India (Rs 221.5 crore) and ONGC (Rs 212 crore).
Other stocks that were in demand include Axis Bank, Bharti Airtel, Larsen and Toubro, Reliance Infrastructure and ABB. “Some of the stocks like HDFC Bank and Larsen and Toubro are logical buys because they have been beaten down badly in the market,” said Shankar Sharma, director, First Global, a brokerage firm.
According to Amitabh Chakraborty, President (equities), Religare, during the last month, crude oil prices were beginning to moderate, but still closed the month at $126 a barrel, giving credence to beliefs that perhaps there was another rally in the offing.
This led to demand for oil exploration companies like ONGC and Cairn India. However, in the last ten days, crude oil prices have plummeted to $113 a barrel. And there are expectations that they will come down further after the Beijing Olympics because of a fall in demand for diesel, which is being used as fuel in place of coal for polluting reasons.
Besides, the US consumption of crude oil is already on the decline. On Tuesday, the US government data showed that the oil demand for the first half of 2008 has declined by an average of 800,000 barrels a day compared with that during the same period a year ago, the sharpest decline in 26 years. “There will be a rethinking about oil exploration companies like Cairn and ONGC in the next few months, depending on how sharply the prices fall,” said Charaborty.
Rate-sensitive sectors like banks have been in demand, mainly because any fall in oil prices means inflation will soften.
But private sector banks have got preference as they are insulated from the expenditure of Rs 60,000 crore on agricultural loan waivers, unlike the public sector banks. Gopal Agarwal, head of equity, Mirae Asset Global Investment India, said sectors like banks, infrastructure and even auto could be in demand, if the interest rates start easing.
Source: Business Standard
According to Amitabh Chakraborty, President (equities), Religare, during the last month, crude oil prices were beginning to moderate, but still closed the month at $126 a barrel, giving credence to beliefs that perhaps there was another rally in the offing.
This led to demand for oil exploration companies like ONGC and Cairn India. However, in the last ten days, crude oil prices have plummeted to $113 a barrel. And there are expectations that they will come down further after the Beijing Olympics because of a fall in demand for diesel, which is being used as fuel in place of coal for polluting reasons.
Besides, the US consumption of crude oil is already on the decline. On Tuesday, the US government data showed that the oil demand for the first half of 2008 has declined by an average of 800,000 barrels a day compared with that during the same period a year ago, the sharpest decline in 26 years. “There will be a rethinking about oil exploration companies like Cairn and ONGC in the next few months, depending on how sharply the prices fall,” said Charaborty.
Rate-sensitive sectors like banks have been in demand, mainly because any fall in oil prices means inflation will soften.
But private sector banks have got preference as they are insulated from the expenditure of Rs 60,000 crore on agricultural loan waivers, unlike the public sector banks. Gopal Agarwal, head of equity, Mirae Asset Global Investment India, said sectors like banks, infrastructure and even auto could be in demand, if the interest rates start easing.
Source: Business Standard
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