We could get into a phase of consolidation given that there are macro headwinds ahead of us and we could remain in range before we breakout, said Kashyap Pujara, ED and Head of Research-Institutional Equity, Axis Capital.

According to their house report there are only about 125 companies that are of good quality.

He said quality has been theme for the market for quite some time now and so recognize these quality stocks and enter only those names, even in the midcap space.

Sectorwise, the house prefers domestic pharma companies where the businesses are growing 10-20 percent and have domestic formulation businesses.

According to him, it also makes sense to look at largecap IT.

"The current price levels have been absorbed in the system but the question is how it would impact India if the prices went up further from here and if they did, it would be a headwind for us," he said.

However, incremental supply is also expected to come in which could keep the upside for oil capped.