Simon Powell, Global Head of Thematic Research at Jefferies believes that the current market correction is an opportunity to buy quality stocks and some of the selling witnessed might just be investors looking to book profits because of the stellar run witnessed by the market in the past six months or so.

Share Market Live

NSE

The World Health Organization (WHO) has flagged a new COVID-19 variant - B.1.1.529 - indicating a large number of mutations in the new variant, which will require further study.

"Whatever comes in terms of mutations of coronavirus, there won’t be wholesale shutdowns like before. People are looking for an excuse to take profits here," Powell said.

“The market reaction to this today – there may be a little bit of profit-taking in this news as opposed to genuine fear here. We are very early in terms of getting information on this variant,” he said in an interview with CNBC-TV18.

Also Read:

New COVID variant B.1.1.529 appears to be more transmissible: Dr Shashank Joshi

“I think people are looking for an excuse to take profits here. People are needing an excuse to trim some exposure here and this is a great opportunity to do that given a little bit of potentially negative news,” he said.

“We do have greater vaccine penetration. People ought to potentially take opportunities to buy here because we are of the view that the world isn’t going to completely shut down again because people don’t want that to happen,” he added.

Also Read: Market correction healthy; positive on consumer discretionary, autos, banks: DSP Investment Managers

Fed recently indicated that they might have to hike rates sooner than anticipated. When asked if he sees that as a big risk for the market going forward, he replied, “The debate in the market about whether the Fed is going to raise rates or not is more to do with economic activity and inflation than issues about the virus. I think there is an expectation in the market starting to be priced in potentially that there is going to be some kind of rate hike in the future. So what is happening today is more about profit-taking on the back of this might be a variant of concern, so let us just take money off the table coming into year-end.”

For the full interview, watch the accompanying video.

Catch all market updates here.