Dean Kim anticipates minor pullback post record market highs

The significant rally in the markets this year has raised concerns about potential overbought conditions. Dean Kim, Head of Global Research Product at William O'Neal, believes a minor pullback now would be a natural adjustment.

Indian markets have seen a remarkable 11% rally this year, with a near 6% rise in just November. The Nifty 50 today, December 1, hit a record high of 20,228.10, crossing the previous high of 20,222.5 set on September 15 this year. It took 51 trading sessions to recover the 1,300 points from the low of 18,837 hit on October 26.

Kim pointed to the rising 10-day moving average, currently just 1% below, as a solid support level.

Kim also drew attention to positive macroeconomic factors, such as declining oil prices and a weakening US dollar, which are beneficial for the Indian market.

Among sectors, banks are Kim's preferred picks. "Now that inflation has started to be under control, we will probably see rates coming down. That is generally great for banks," he said, citing the global rally in banks, particularly in Europe and Brazil. .

Kim noted that most sectors have recovered from their October lows, barring healthcare, staples, and utilities that are still below their 200-day moving averages.