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Markets movement to depend on earnings season, RBI policy: Prashastha Seth

Wait for two things, a) how the quarterly results pan out over the next few days and b) what is essentially the outcome of the RBI policy.

ET Now|
Updated: Jul 04, 2011, 03.19 PM IST
In a chat with ET Now, Prashastha Seth, Sr Fund Manager, IIFL Wealth, India Infoline, talks about markets trends.

ET Now: Are you still putting in money if you were at least or are you taking a breather right now after the rally that we have had? What is it that you like or dislike?

Prashastha Seth: I would not be putting money right now. Markets have rallied a lot from the bottom, so you are talking more of an 8-9% kind of a move from the bottom. I would want to wait for two things, a) how the quarterly results pan out over the next few days and b) what is essentially the outcome of the RBI policy made that is going to happen in July? Now there have been some views yesterday or over the weekend that were expressed by Deepak Parekh that RBI should kind of hold on to the rate increase and if that does not happen, that will be very positive for the markets. On the other hand, you would probably want to wait and see how the results are because this quarter results could again probably disappoint because the companies would have faced a lot of issues in terms of margins and they would not have been able to pass on the higher cost that they had seen to the consumers, so I would wait and see how the earnings season pans out and then take a call. In terms of what we like or dislike, it is just the same. We like pharma, FMCG and IT and believe that if you have to play beta in the market, you have to be in banking. Banking essentially gives you the best beta in the market. It limits your downside, so I would probably be concentrating a lot of my portfolio in these three or four sectors.

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