Indian stock market sentiment upbeat but investors need to be cautious, says Divam Sharma of Green Portfolio, PMS

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Divam Sharma, Founder and Fund Manager at Green Portfolio, PMS, underscores that the market sentiment is upbeat but a lot of things are currently quite expensive so investors should be cautious while investing since markets are very volatile right now. In an interview with Mint, Sharma shared his views on a tug-of-war between FIIs and DIIs and Fed rate cut expectations also. Edited excerpts: ⁠Markets have done great over the last year.

We have been seeing new allocation value opportunities coming at the listed pace. Investor confidence is very high, we are seeing so many IPOs and new-age companies coming up. Some new papers and preferential allotment opportunities are attracting capital.

With elections coming up, investor enthusiasm is very high. In overall markets, a lot of things are currently quite expensive with issues. There’s a lot of investor appetite, yet there needs to be caution while investing particularly since markets are very volatile right now.

Also Read: Morgan Stanley sees significant opportunity for bottom-up stock picking in India; lists its preferred sectors FPIs continued their selling streak this year with US bond yields witnessing a spike, triggering them to increase their position in the debt markets. The US also reported higher-than-expected inflation of 3.1 per cent which is above the Fed’s annual target of 2 per cent. The Fed has maintained its hawkish stance, asking investors to maintain patience before expecting any rate cuts.

But there’s a silver lining to it as ahead of India’s inclusion in global bond indices from June 2024, FPIs have been buying sovereign debt since October last year. As far as equity markets are concerned, DII’s neutralized the FII selling to some extent. Also Read: Why