Markets remained stable in FY19 due to Nifty's rally, says Motilal Oswal

Graphic: Motilal Oswal

According to the brokerage, among sectors, private banks rallied the most in FY19, with 34 percent followed by PSU banks that surged 28 percent. The worst performing sectors were media (-25 percent), autos (-22 percent) and metals (-15 percent), the report said.

Meanwhile, among stocks, top performers were Bajaj Finance (71 percent), Reliance Industries (54 percent) and Axis Bank (52 percent) while worst performers were Vedanta (-14 percent), SBI (-8 percent) and Hindalco (-6 percent), it added.

Graphic: Motilal Oswal

Motilal Oswal expects that the near-term direction of the market will be decided by the developments in the political front.

"After four tepid years in the banking sector, expect better profits and the return on equity (RoE) recovery in the corporate banks," said the brokerage firm.

IT sector will continue its sustained earnings growth, favourable deal activity and reasonable valuations, it said, adding that auto sector will remain weak while Reliance Industries will see limited upside.

In LargeCaps, Motilal Oswal prefers ICICI Bank, Axis Bank, Titan, Maruti Suzuki, Bharti Airtel, Infosys, M&M, Coal India and SBI.  In MidCap, they are betting on LIC Housing Finance, Federal Bank, DCB, Godrej Agrovet, Indian Hotels, Page Industries, Crompton Consumer, Oberoi Realty, Ashoka Buildcon and M&M Financial Services.