The global markets were spooked by the Hungarian debt crisis and the slowdown in the US economy reflected in its unemployment figures.
The Indian markets tanked on opening and remained deep in the red moving in a narrow range. The Sensex sank 336.62 points down to close at 16,781.07, while the Nifty struggled to close above the 5000-mark at 5,034, down 101.50 points.
Many analysts see the losses as a buying opportunity. But, says Devina Mehra of First Global, “one has to be very selective. Whilst the Indian economy is outperforming the other economies, the risk remains.”
The Indian market is fairly sectoral. While frontline stocks like RIL and Bharti had seen multi-quarterly lows , auto, banks and pharma have faired better.commodities and metals are under pressure, she said.
Mr Hiren Dhakan of Bonanza Portfolio says this is a good time to buy at every dip for long-term investors. It is possible that the Nifty could see another 200-300 fall and 4,600-4,700 are good levels to buy. “But we have a cautious approach in the short term. Midcaps are more susceptible to volatility so we prefer to keep cash.”