Investors gained Rs 7.63 lakh crore in wealth after seeing erosion of Rs 13.28 lakh crore Thursday.
MUMBAI: Stock indices bounced off from Thursday’s lows, rising 2.5% with the market digesting the Russian invasion of neighbouring Ukraine. The Nifty gained 410 points to close at 16758.40 while the Sensex jumped 1329 points to 55858.42.
Investors gained Rs 7.63 lakh crore in wealth after seeing an erosion of Rs 13.28 lakh crore Thursday. However, despite the rise, analysts advise caution, given the possibility of the Ukraine crisis getting protracted or worsening. At best, they advise waiting at the sidelines until the volatility cools off and limited stock picking among bluechips.
“From a positional trading point of view, I’d stay away until the volatility cools off,” said Siddarth Bhamre, a director at InCred Equities. “Just as trend is a trader’s friend, volatility is an investor’s friend as he gets to pick good stocks at reasonable valuations.” Bhamre’s picks include SBI, Maruti, L&T and Infosys.
Fear gauge India Vix fell 16.4% to 26.74 from 18-month highs a day earlier, which dragged down the Nifty by 815 points, the most in 23 months as Russia declared war on Ukraine. However, a Vix reading above 20 still indicates elevated uncertainty. Another worrying factor for market watchers is the persistent FII selling. On Friday, as the market bounced, FIIs sold a provisional Rs 4,471 crore of shares even as DIIs, including mutual funds, purchased a provisional Rs 4,318 crore of shares.