Mumbai, Jan 9 (PTI) Projecting zero returns from theNifty, Swiss brokerage UBS has projected a 10 per cent cut inits index target at 10,500 for calendar 2018, even as itremains positive over the long-term."Top-down, we forecast Nifty earnings growth willrecover from 9 per cent in fiscal 2018 to 13 per cent in 2019,but driven largely by financials," the brokerage said in areport today."However, earnings growth is likely to disappointagainst consensus forecast of 22 per cent growth for fiscal2019, implying a 10 per cent cut," it added.Accordingly, the brokerage estimates "no returns fromthe Nifty in 2018" and has set the index target at 10,500 forthis December.Besides, UBS also said the economy is likely torecover as it expects GDP to grow from 6.6 per cent in fiscal2018 to 7.4 per cent in fiscal 2019.However, the report noted that a sharp earningsrecovery, with continued robust macro stability appears pricedin by the markets."A sharp earnings recovery appears priced in. Themarkets are already close to our 2018 target, given optimisticfiscal 2019 consensus earnings expectations, which build in astrong growth recovery," the report said, adding "alternately,if we factor in realistic growth, the markets are trading at2-year forward earnings".The brokerage major also noted that despite its "mutedmarket view", the country remains a stock picker's market,more so in this calendar year."We are overweight private banks, property, oil andgas, telecom, IT services, and auto parts," it said adding itis underweight on cement and industrials/infrastructure.UBS' view on the markets is contrary to other globaland domestic brokerages. Deutsche bank has estimated thebenchmark index to hit 11,500 levels, while Kotak Securitiesalso sees Nifty at 11,600 by December on back of strongeconomic and earnings recovery.The benchmark 50-stock index today closed at fresh high of 10,637.
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