The Risks Axis Mutual Fund’s Jinesh Gopani Sees In The Near Term
As Indian markets have surged to record highs, Jinesh Gopani advises investors to remain cautious.
The U.S. is looking for a big dose of fiscal stimulus in March, making the next 15-25 days tricky, the head of equities at Axis Mutual Fund told BloombergQuint’s Niraj Shah in an interview.
“Everything is getting factored in very fast,” he said, advising people to track inflation, crude oil prices and interest rate trends before investing. Investors must be attentive despite a stellar run by the markets and foreign investor inflows amounting to around Rs 20,000 crore since the Union budget on Feb. 1, he said.
A rise in yields on government securities and a spike in the U.S. Dollar Index, according to him, can cause foreign fund flows to reverse.
The recent surge in Covid-19 cases, too, is a cause of concern, Gopani said, adding that a lockdown would be adverse from the economic standpoint. Everything is “not good” in the economy given that it’s the organised sector driving the markets, he said.
Gopani, however, expects the next two to three years to be stable, with economic growth gaining momentum.
Other highlights from the conversation:
- The only way to invest in banking and public sector stocks is by waiting and watching how the sector navigates hurdles in the coming months.
- Technology is going to play a big role in the banking sector.
- Infrastructure proxies like steel, cement, capital goods, home improvements and building material companies are attractive.
- With consumer staples, he said from a longer-term perspective, it’s a stable and steady theme which may not do well in the near term.
- Things will look good for investors in the next 2-3 years if there aren’t any “black swan” events.
Watch the entire conversation here: