PSU stocks face correction; new-age stocks surge as growth momentum returns: Ajay Bagga, Elyments Platforms
“Defence and railway stocks which are largely in the public sector had become very overvalued and a lot of the future execution was already factored in. So, they were due for a correction. We have seen very good results coming through and there is a growth on the top line and bottom line. But the valuations have gone into multi-year, this kind of growth continuing. So, it was quite viable that we would see some amount of consolidation, a breather for a few months and then the next leg up starts as the execution comes in,” says Ajay Bagga, Chairman, Elyments Platforms.
ET Now: Because the damage was coming from the macro front, tell us that since the US recession worries cools off, US seems to be on a disinflationary path, the kind of economic data coming in, talks are about Fed taking a rate cut in September and so are the expectations building up for other central banks only. But in such a scenario, what could be the possible and, of course, this is a good news for the markets, but then I wanted to understand how would FIIs approach the emerging markets in such a scenario when rate cuts are going to take place?
Ajay Bagga: As you mentioned already, this is the best week since November for the US markets. It is the best week of stock market gains in more than a year for Asian markets and for Japanese markets, it has been a great week. So, we started Monday with three big worries. One was the US economy. Second was the yen carry trade unwinding. And third was the geopolitical risk from Iran taking some action on
