The year has begun on a note of high optimism. Demand is high and the appetite for equity runs strong. The government even managed to do a successful offer for sale in a less fancied commodity stock. In the coming weeks, more government offerings are lined up.

The disinvestment juggernaut is finally moving after a tepid 2020. The government is in a mood to sell quickly while the going is good. The next few weeks will be spent second-guessing the budget and setting expectations.

The rush into midcap stocks is unabated showing strong retail participation. The top of mind question is how the market trend of 2021 will be different from 2020.

Expectations related to this question are leading retail investors to redeem their mutual fund investments. Most participants want to move monies from mutual funds to direct equities. Clearly, a sense of adventure seems to be setting in.

There is nothing unusual about this trend. Every year, we see such a trend in the pre-budget trade. But, this year, the focus is simply obsessive about trading, risk-taking, and speculating. But, the budget seems to look like a non-event at present.

The coming weeks will see the market shape up its budget expectations and closely watch the Government’s cues. Till then, it looks like happy hours in trading will play out. The din and noise are rising and everybody is enjoying the party.

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Posted on October 16, 2021
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