Worsening the conflict between Russia and Ukraine and continued sanctions against Russia could bring the Nifty to 14,000 by the end of the year, with a full defensive skew, it said.
Global markets have been rocked in recent weeks by the Russian invasion of Ukraine and the resulting rise in commodity prices. Higher crude oil prices are important for India, as the country imports 85% of its oil needs.
BofA Securities said it is leaning towards the scenario where Nifty closes the year at 17,000, aided by macro buffers.
The financial services firm said the index target implies a 2% increase – which is moderate – but sector rotation could lead to larger returns.
The Bank Nifty Index is down 9.6% since October 19, 2021, when benchmark indices last hit record highs. The Nifty has fallen 7.8% since that date.
It has lowered consumer staples to underweight and changed its stance on healthcare and autos to overweight.
In a scenario where geopolitical events deteriorate and crude oil costs an average of $130 a barrel by 2022, India’s gross domestic product growth could drop to 7.5%.
Next, it would be bullish or overweight in IT, utilities, healthcare and telecom along with energy/metals, while it would be underweight or bearish in financials, industrials and discretionary stocks.
This post Nifty: Nifty could close 2022 at 17,000 if tensions ease: BofA Securities was original published at “https://economictimes.indiatimes.com/markets/stocks/news/nifty-can-close-2022-at-17000-if-tensions-abate-bofa-securities/articleshow/90280241.cms”