Post Market Views - Dec 10, 2020 - Reliance Securities

Mr. Binod Modi, Head Strategy at Reliance Securities

Domestic equities traded lower today on weak global cues. While benchmark indices made decent comeback from days' low, profit bookings were visible in many stocks. FMCG were the sole performer today, which arrested sharp market fall. Nestle, ITC, Britannia were among top gainers, while UPL, UltraTech and Shree Cement witnessed sharp drop. UPL lost more than 10% due to whistleblower's allegation about siphoning off money, while CCI's raid in cement companies' offices led sharp correction in cement stocks.

In our view, improvement in prospects of sustained earnings growth led by encouraging key economic indicators and upbeat management commentaries of different industries is likely help sustaining premium valuations of market. However, a broad-based rally across all counters might not sustain for long and men would be separated from the boys in the context of potential of earnings recovery. Hence, investors must focus on quality names with high margins of safety.

Source : Equity Bulls

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