High net worth investors (HNIs) expect the Sensex to jump another 10 per cent in 2010, a survey by Morgan Stanley of its private wealth customers revealed.
The respondents of the survey see the Sensex touching a high of over 19,600 points during the year, but ending the year around 19,100-19,200 points. On 21 July 2010, the Sensex closed at 17,977.
Most respondents consider global markets and corporate profits as the most important driver of Indian equities even as they worry most about inflation.
Despite their cautious views on equity market during the year, close to 40 per cent HNIs holds more than 50 per cent of their portfolio in equities. Real estate accounts for 25 per cent of their portfolio. Surprisingly, HNIs still hold 10 per cent of their portfolio in cash.
Among all the asset classes, the respondents find the mid-cap stocks the most attractive at the current scenario, followed by large cap stocks, gold and real estate. A high percentage of the respondents (61 per cent) thinks stock-picking is the best equity strategy at the present situation, but close to 20 per cent of the respondents feel prices are expensive at current levels.
Among different sectors, financial and industrial are the most preferred sectors for these HNIs during 2010, the survey revealed.
According to Morgan Stanley, HNIs are backing risk assets and could continue to support equity markets. “Their bullishness on Real Estate is an interesting input for our positive call on property stocks,” it added.
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