Can expect a 5-7% Santa Claus rally in 6-8 weeks: CLSA on Indian markets
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The stock market may see a "Santa Claus rally" of 5-7% over the next six to eight weeks, said Vikash Kumar Jain, India strategist at brokerage CLSA. Jain said the market has already absorbed the selling by foreign investors, geo-political tensions, some large IPOs and a weaker results season in the last couple of weeks. "I think a lot of the interim bad news is now in the price. With sentiment cooling off, I am arguing for a possibility of some kind of at least an interim relief rally," said Jain. He also said that seasonality could play a role in this, as the market has rallied three out of four times in December in the last thirty years. "The median return is 2-3% this month (December)," he said. Jain said the banking sector could be leading this short-term rally as the bond yields have moved up since Donald Trump's election, which is beneficial for the lenders. Jain added that the valuations of these s...