Investor Basant Maheshwari, in a YouTube live session on June 4, warned holders of PSU stocks that the market trend for PSU, defense, and renewable energy sectors could change with the formation of a new government.
Several brokerages had identified stocks that could benefit from a Modi 3.0 government. These “Modi stocks” are businesses that have benefited from Prime Minister Narendra Modi’s policies, attracting investors looking for government-driven growth.
However, Maheshwari predicts that the currently outperforming PSU stocks are likely to decline. “Stocks from the defense sector, renewable energy, or any other PSU that were doing well are likely to see a downtrend. I advise investors to be cautious and analyze their shares,” he said.
Brokerage firm UBS also suggested that investors switch from PSUs to FMCG. Emkay predicted a short-term market decline due to increased risk perception and advised avoiding PSUs and capital goods for now, while expecting a significant rebound in FMCG and value retail sectors.
Trading Strategy in the Coming Days:
Maheshwari recommends a staggered investment approach due to market volatility. He advised investing in parts, both before and after the elections. “If you have the money, invest carefully in stages,” he said.
When asked about market recovery, he advised investors to stay focused and hold on, as the market will recover soon.
The recent general elections in India resulted in the BJP falling short of a majority, leading to a market decline of over 6%.
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