As Sensex crosses 50k, valuations do look stretched
As the Sensex crossed a historic 50,000 this morning, the experts believe that, valuations do look stretched.
image for illustrative purpose
Mumbai, Jan 21 As the Sensex crossed a historic 50,000 this morning, the experts believe that, valuations do look stretched.
In fact, the experts are also of the view that invest for the long haul. Don't get too greedy and don't get too scared.
It was on 21 January, 2008 when the Sensex had had hit the lower circuit and nosedived by 10 per cent. However, it is exactly after 13 years that the Sensex has bounced back by hitting the magical figure of 50,000.
The liquidity expansion by the central bank and the ample FII driven liquidity, a V shaped recovery of growth aided by the discovery of vaccine, and most recently the change of guard in US have been some of the factors propelling markets higher and higher.
"The valuations are a function of earnings and earnings not coming through remains the key risk at the current juncture," says Joseph Thomas, head of research, Emkay Wealth Management.
That Sensex has crossed 50k mark may be a historic moment for all of us. Still, experts have a word of caution for the retail investors.
"It is also time for the investors to book profit in those penny stocks which have moved up purely due to the market stock," says Avinash Gorakshakar, head research, Profit Mart Securities.
