Stock Market: ''This boom is like a recession, don't be happy if Nifty reaches 25k', is the market going to break?

Stock Market: ''This boom is like a recession, don't be happy if Nifty reaches 25k', is the market going to break? Experts said that if you are not among the handful of heavyweight stocks that are pulling the index up, then you may have to suffer losses in the future. Sheth pointed out the fact that the Nifty Microcap 250 is still 12.22 per cent below its October 15, 2024 level.

The stock market has been looking great for the last few days. Nifty has reached above 25000, but many investors are not happy with this because they are still afraid of it. Meanwhile, Apoorv Sheth, Head of Market Perspectives and Research at Samco Securities, has claimed that this is not a bull market, but an illusion of bullishness.

He said, "If you are not among the handful of heavyweight stocks that are pulling the index up, then you may have to suffer losses going forward. Sheth pointed out the fact that the Nifty Microcap 250 is still 12.22 per cent below its October 15, 2024 level. The Nifty Midcap 150 index has declined by 6.09. Despite the rally, the Nifty 50 is still where it was in October last year.

The rise is due to some large caps.

Sheth of Samco Securities said that the headline index is touching new highs. But this is not a broad-based rally. It is a small rally led by some large caps, while the rest of the market is in decline.

Index is moving, not portfolio

Sheth said that since October 15, 2024, 363 out of 730 stocks have declined by up to 25 percent. A total of 170 other stocks have declined from 25 percent to 50 percent. Seven stocks have declined by more than 50 percent. He further said that Nifty50 has regained the figure of 25000 after a long decline of 7 months. But the problem is that despite the rise in the index, the portfolios have not yet gained momentum accordingly.

Why is this boom looking like a recession? 

He further said that excluding the 20 recent IPOs, about 75 percent of the top 750 stocks, i.e. 540 out of 730, are still in losses. During this period, only 190 stocks have given positive returns. Sheth said that if you are stuck in one of those 170 stocks which are down by 25 percent to 50 percent, then this boom looks like a recession.

Why is the market booming? 

Despite global and local uncertainty, the domestic market has performed strongly in the last one month. The strong performance in the market shows that the market is rising on the hope of easing geopolitical tensions as well as the ongoing trade and tariffs with the US. Kotak said this week that a reduction in the conflict between India and Pakistan could give a limited boost to investor sentiment, which is uncertainly balanced between risk, low income growth, declining income and high tariffs.

(Note- The information given here is the opinion of brokerage firms. Bazigar Investment does not take responsibility for it. Before making any kind of investment, please take the help of your financial advisor.)