Monday, January 7, 2013

Goldman sees Nifty touching 7K mark by Dec


Goldman sees Nifty touching 7K mark by Dec

PTI       Last Updated: January 7, 2013  | 19:57 IST
TAGS: Goldman | Sensex | Nifty | Tata Steel | Bajaj Auto | Infosys

Goldman Sachs
 on Monday said it expects the NSE Nifty index to cross the 7,000-mark by the end of the year.Goldman sees Nifty touching 7K mark by Dec

In a note dated January 4, the US company said: "Given the inexpensive valuations and conservative investor positioning, we are overweight on India, China, Korea and Singapore, and tilted towards cyclicals."

It sees Nifty rallying 17 per cent in the year to cross 7,000 points (from 5,993 points on January 3), or a price-earnings multiple touching 14.5 times.

The 50-share National Stock Exchange index Nifty lost 27.75 points, or 0.46 per cent, to end at 5,988.40 on Monday.

Goldman's Asia-Pacific Outlook Report said Korean stocks will have the highest return in the year with a likely gain of 18 per cent.

Goldman has included Bajaj Auto and Tata Steel in Asia-Pacific "growth recovery" group of stocks that have favourable growth and valuations. The company also sees tech giant Infosys as a stock with a potential "catch-up" opportunity after lagging in 2012.

The report also lists Tata Motors, Sterlite and Hindalco as stocks with favourable macro exposure and attractive profiles.

The watchwords for 2013 are 'growth recovery' and accordingly Asian regional economic growth should improve to 6.9 per cent from 6.2 per cent in 2012, and corporate earnings growth should accelerate to 13 per cent and 14 per cent in 2013/14 after two years of stagnation, it said.

Domestic markets rallied close to 28 per cent in 2012, after a disastrous 2011 when the both the benchmarks tanked over 25 per cent.

On the global front, the report said, "In the five weeks since we published our 2013 views, US has reached a fiscal compromise, China's growth and policy outlook has firmed, and our marketing feedback shows investors to be under-risked relative to their views."

"We increase our sectoral growth tilt by raising autos and capital goods, and reducing telecoms." The report said 2014 should see a further pick up in regional growth to 7.4 per cent.

The main drivers of this outlook are a stabilisation and then improvement in developed markets growth; a recovery in Asian domestic demand facilitated by accommodative fiscal and monetary policy; and stable-to-softer energy prices, said the Goldman Sachs report.
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