The US inflation data that came out on Thursday evening shows a better-than-expected cool-off and this has given the markets a belief that there might be some breathing room on offer from the US Federal Reserve and other global central banks like the Reserve Bank of India while deciding their next rate action steps.

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Interest rate actions across the globe generally take cues from US Fed's policy and thus according to Sandeep Bhatia, Head of Equity-India at Macquarie Group, interest rates in India are now expected to peak sooner than expected.

Also Read | US inflation slows more than expected, gives Fed breathing room

“Interest rates are now expected to peak by March; they were expected to peak after June next year, but now the view is it will be March and once we have seen a peak of interest rates, that will be a better time to look at the new age stocks,” he said.

The Indian equity market has been witnessing a resurgence of sorts and there is no reason that it will not continue, as per Bhatia. When it comes to sectoral outlook, he believes that the IT stocks will continue their run.

“Its value there, it's definitely better than expected outcomes on the US macro, which is helping,” he said.

Also Read: Moody's lowers India's growth projections to 7% on high inflation, rising interest rates

"The rest of the world will continue to be in a zone of conflict, flux and uncertainty, that is not going to go away and that is helping India," he further reasoned.

Macquire finds it tough to take a longer-term call on public sector undertaking (PSU) banks. However, it prefers SBI and Bank of Baroda in the banking space.

Also Read: Your EMI may rise as several lenders hike home loan interest rates

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(Edited by : Abhishek Jha)