The setup looks ripe for investors who want to be in Indian equity markets for the long term.  Investors should buy those stocks where the growth visibility is high as against the ones which have fallen more, suggest experts.

After buoyant equity markets seen in the year 2017, Indian markets witnessed a selloff, a much awaited one post Budget where stocks from the S&P BSE 500 index corrected up to 50 percent in just one week.

Stocks which have suffered a double-digit cut include names like Vakrangee (down 58%), PC Jeweller (down 30%), Fortis Healthcare (down 27%), Just Dial (down 27%), Reliance Naval (down 27%), and IFCI (down 25%) among others.

The S&P BSE Sensex has fallen nearly 2000 points in the same period while the Nifty50 lost nearly 600 points in the same period.

The fall was largely led by both domestic and global factors. On the domestic front, the rise in crude oil prices, fiscal slippage, the rise in interest rates and long-term capital gains tax (LTCG) weighed on sentiment.

Globally, rising bond yields and fear of US Fed raising interest faster than expected led to some churn in Wall Street which led to a fall of near 1600-point drop in Dow earlier in the week.

The setup looks ripe for investors who want to be in Indian equity markets for the long term. Investors should buy those stocks where the growth visibility is high as against the ones which have fallen more, suggest experts.

A massive fall in a stock does not account for it being a value play. Instead, investors should hunt for those stocks which stand to benefit from the reforms tabled by the finance minister in the Budget 2018.

Laregcap stocks are a better play at current levels while investors should remain cautious while putting fresh money in the midcap stocks at current levels.

Laregcap stocks are a better play at current levels while investors should remain cautious while putting fresh money in the midcap stocks at current levels.

Corrections are part of every bull market and as long as Nifty is holding above its key support levels, the upside remains intact. Investors should use dips to buy into quality stocks on every dip.

History suggests that in a bulls market, 10 percent type of correction is alright. A meaningful dip also helps investors to jump in who were waiting on the sidelines. But, making money will not be easy in 2018 unlike the year 2017.

Investors should stick to quality stocks rather than eyeing the high beta names. One thing which investors should avoid is to stop their running systematic investment plans (SIPs) and instead focus on accumulating stocks from those sectors which are likely to benefit most from Budget.

Lastly we advises users to check with certified experts before taking any investment decisions.

source: moneycontrol.com