“We’re holding on to these gains because all the bad news is behind us. Every sector — IT, pharma, hospitality, media — has already seen its correction. The market is now discounting the future,” Srivastava told ET Now.
If Nifty closes above 25,200, it’s a bullish trigger
According to Srivastava, the Nifty is at a crucial technical juncture.
“A close above 25,200–25,220 will confirm positive momentum. We’ve tested this level several times before — crossing it decisively signals the start of a new uptrend,” he explained.
He added that even during recent dips, Nifty has formed higher bottoms, showing resilience.
“If we sustain above this level and get a positive weekly close, it’ll likely trigger a buy signal on weekly charts — just as Bank Nifty did last week.”
Short-term Nifty target: 25,680
Srivastava sees the next move in markets being earnings-led, supported by a confluence of policy actions.
“Tax cuts, GST relief, liquidity infusion, and lower interest rates — all these are coming together. The macro setup is turning favourable, and earnings will reflect that over the next few quarters.”He expects steady growth momentum to build through 2026 into FY27, calling this a “phase of quiet recovery with solid undercurrents.”
Avoid defensives like IT, FMCG, and pharma; look for growth instead
In a contrarian take, Srivastava advised investors to stay away from defensive sectors like IT, FMCG, and pharma.
“These sectors are growing earnings in single digits — that’s defensive behaviour. You buy defensives only when the rest of the market isn’t growing, and that’s not the case now,” he said.
He pointed out that IT largecaps have underperformed the Nifty for decades.
“On a 30-year basis, the IT index has lagged the Nifty. Unless you find a standout company with strong growth, it’s not the place to be right now.”
Where to put your money: financials, autos, metals, and realty
Srivastava sees the next wave of outperformance coming from cyclical and growth-driven sectors.
“Money should move where growth is — in financials, autos, metals, power, infra, and real estate,” he said.
With improving credit growth, softening interest rates, and strong festival demand, he believes interest rate-sensitive sectors will lead the rally.
“These are the pockets that will show momentum before the broader market catches up.”
Bank Nifty leads the charge
Banking stocks are already flashing early bullish signals.
“The Bank Nifty triggered a weekly buy signal last week — we’re now watching for Nifty to confirm that strength,” Srivastava noted.
He believes the financial sector remains the market’s backbone, and any follow-through in Nifty will only strengthen the overall uptrend.
Markets entering a “steady growth” phase
Summing up his outlook for the coming months, Srivastava said:
“We’ve moved past the noise. The structure is strong, liquidity is improving, and earnings recovery is around the corner. The festive uptrend should hold — and expand.”
Srivastava’s message for investors:
- Don’t chase defensives.
- Focus on cyclical growth themes.
- Watch the 25,200 level for confirmation of a new rally.
“The market is quietly rebuilding its momentum. This is the phase smart money gets positioned before the next big move,” he says.
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