V K Vijayakumar, Chief Investment Strategist, Geojit Financial Services, says that fundamentals, technicals and sentiments turning favourable at the same time are rare in the market. “This is what has happened now. The market went into the big event, elections, very light with Nifty correcting around 600 points from the May highs. Profit booking also happened on a large scale. The short position in the market also is high.”

“All these are going to change dramatically. DIIs, HNIs, retail ...are all going to turn buyers. Short-covering can add to the momentum, he adds.

Vijayakumar believes that the rally is likely to be led by largecaps, with stocks such as RIL, ICICI Bank, HDFC Bank, Kotak Bank, Axis Bank, Bajaj Finance, Bharti Airtel, L&T, M&M, Tata Motors, Bajaj Auto, Eicher Motors are fundamentally strong largecaps with potential to lead the rally. IT stocks like TCS, Infy, HCL Tech, Coforge, Persistent and L&T Tech offer contrarian buying opportunities, he adds.

“The GDP numbers which came on Friday were better than expected with 8.2% growth. This will provide fundamental support to the market. S&P’s upward revision of India’s rating outlook also is positive," he says.

Angel One in its technical report says that the Nifty index is situated at a critical zone of make-or-break and the exit poll outcome is likely to trigger momentum in the week. “For now, 22450-22400 is the potent support, while a further drop could disrupt the short-term structure of the technical charts. On the higher end, 22600-22650 is the intermediate resistance, followed by the sturdy hurdle of the bearish gap placed around 22820-22850 subzones.”

The brokerage in its report says that the markets are expected to be vulnerable until the election outcome, and volatility is likely to remain high during this time. The agency advised investors to be cautious in the current scenario. “On the other hand, meeting the street expectations based on the exit polls could toss the indices higher. Therefore, having a solid risk management strategy with hedged positions is wise for market participants.”

(DISCLAIMER: The views and opinions expressed by investment experts on fortuneindia.com are either their own or of their organisations, but not necessarily that of fortuneindia.com and its editorial team. Readers are advised to consult certified experts before taking investment decisions.)

Lok Sabha Election 2024

Exit poll euphoria! Sensex surges 2,777 pts to 76,739, Nifty touches 23,339