The recent correction in financial stocks should be seen as a long-term buying opportunity, said CLSA's chief strategist Christopher Wood in his weekly note Greed Fear on Thursday."There have been some fun and games in Indias financial stocks over the past week partly driven by Reserve Bank of India announcements, and partly driven by the market discounting higher wholesale funding costs for nonbank financial companies.
This setback should be viewed as a long-term buying opportunity," said Wood."Still portfolios with such exposures need to hedge the higher oil price risk," he added.The sell-off in financial stocks, particularly has been at the centre of the weak trend in market recently.
Financial stocks have been weakening due to fear that there will be a contagion effect after ILFS default.
The ET NBFC index has fallen nearly 15% in the last one month.