Market sell-off sparks concern: Has the market bottomed out and where to invest?

Today’s market sell-off has triggered panic among investors, as participants are trying to guess if the worst is over or if share prices have still some room left to fall.

Analysts and traders weigh in:

Arun Kumar Mantri, Founder of Mantri Finmart, offers insights: “We anticipate the market to establish its bottom around the 18600-18650 mark, where the long-term 200-DMA moving average is situated. On the flip side, we see positional resistance at 19300-19400. For Bank Nifty, 41500 represents the next major support, followed by 41300, where we expect a short-term bottom to form in the coming sessions.”

Arun Mantri also notes, “On the domestic front, continuous selling by Foreign Institutional Investors (FIIs), coupled with bearish positioning in the monthly F&O expiry, has exerted downward pressure on the index. Global market conditions and the escalating volatility in crude oil prices will determine the short-term trend.”

Rajesh Shrivastava, trader, adds, “While timing the market bottom remains uncertain, we still anticipate continued downward movements. The November series appears devoid of positive signs, and the prevailing negative sentiment persists.”

Gaurav Dua, Head of Capital Market Strategy at Sharekhan by BNP Paribas, shares his perspective: “Market corrections in the range of 8-12% from peak levels occur annually, sometimes even more frequently. In hindsight, these pullbacks tend to present opportunities. In the current correction, the bulk of the pain may be priced into large-cap stocks. However, broader market corrections could be more pronounced and prolonged.

Where should one park money?

“Investors should be selective, avoiding highly volatile momentum-led stocks. While it’s impossible to time the markets precisely, investors with an investment horizon of at least 18-24 months should consider investing in quality stocks, as valuations are supportive,” stated Gaurav Dua.

Arun Kumar suggests, “Stocks that have previously delivered substantial returns have undergone significant corrections, such as defense and railway counters, along with banking and select mid-cap stocks. Further, Banks, IT, and consumer durable sectors are expected to rebound if the market recovers from current levels and can be considered for accumulation at this juncture.”

Disclaimer: The views and investment tips expressed by investment experts on Moneycontrol are their own and not those of the website or its management. Moneycontrol advises users to check with certified experts before taking any investment decisions.