Dipan Mehta, Member, BSE and NSE, said, "I am not at all alarmed by today’s fall. What we are seeing is a natural correction taking place after the market has rallied for the past few trading sessions. It is more or less like a temporary correction and I think that the overall market remains in extremely positive territory. We are in a bull market and these are just minor corrections, which investors should take as an opportunity to perhaps increase their exposure to equity."
He believes that if the build up in the futures market continues then it may cause a correction. "We are seeing the level of open interest near about what we saw in the first week of February, which was particular high at that point of time. A number of stocks have been added to the futures market and we need to keep that in context. A lot of the open interest this time around is in the hands of experienced traders, hedge funds and it’s not as much with retail investors, which is positive. Even the cost of carry has not completely gone out of whack, it’s not anywhere in the danger zone. There is a build up taking place in the futures market and at some point of time in the future if this particular trend continues then it may cause a correction. At this point of time, I certainly don’t see that as a factor which may cause further decline in stock prices," he added.
Anish Damania of Emkay Stock Brokers says, "I think market looks okay. We were expecting a little bit of a pullback, which has happened; so it is good in a way for the markets to pull back after a decent rally." With the correction that was expected being done away with, Damania sees probably one or two more days of weakness. For the next few months, he predicts that the banking, metals and engineering stocks will perform.
