The Nifty plunged to 10% in the opening session on Friday 13 March 2020, leading trading halt for the first time in 12 years. The cascading effect of coronavirus outbreaks threatening more disruptions to the business and the growth of the world economy.
On the other hand, the volatility of crude & metal prices significantly impacts the Indian economy as well as the capital market. According to experts, low crude oil prices could affect the income levels and the fiscal situations of most oil-producing or exporting countries. The slum of oil prices may curtail overseas money coming into India through their sovereign wealth funds (SWFs), which also reflect bearish sentiment in the capital market. However, fall in crude prices will benefit India, as a net importer of crude oil, to stabilize the fiscal deficit and control the inflation rate.
In the current scenario, you can buy good quality stocks across the sectors such as FMCG, Consumer Durables, IT, Banking and Finance, for the long-term as the market is attractive, and the valuation is quite favourable based on P/E multiple.
It is advisable to invest in a disciplined way in equity as well as equity mutual funds in the long-term time frame. Evaluate your investment plan based on your goal and select the companies having good corporate governance and strong fundamentals. It would be best if you focused on SIPs most efficiently to maintain your portfolio smartly by diversifying all the sectors. Allocate your portfolio about 70 to 75% in large-scale companies across the sectors and 30 to 25% in small and medium scale companies’ stocks.
It is an excellent opportunity for investors to create wealth in the long-run by investing in the right stock having real value (intrinsic value). So far as mutual funds are concerned, it is advisable to purchase in the Index Funds, large-cap funds, and multi-cap funds with the fund house having an excellent pedigree over the decade.