The Sensex is likely to touch 33,000 by this December (Nifty target at 9,936), up 23 per cent from current levels, according to Deutsche Bank Markets Research Strategy update.
The bank is overweight on financials, industrials and materials and underweight on consumer staples, IT services and telecom.
With most macro-economic indicators having improved in the last two years, there is high expectation of a sovereign ratings upgrade.
“Over the past decade, we have witnessed four instances of rating upgrades by S&P and Moody’s, and on an average Sensex has returned 6 per cent in the following six months and 40 per cent in the following 12 months of upgrade,” Deutsche Bank said. The bank sees India harnessing soft commodity prices to realign policy towards investment driven macro-economic growth and create jobs.