New Delhi, Nov 2 : The Indian benchmark indices exhibited initial signs of a positive reversal this week, coinciding with the festive season.

According to market experts, the upward trend was bolstered by sustained healthy inflows from domestic institutions and a decline in oil prices.

However, the recovery was short-lived as bearish sentiments prevailed due to concerns over sluggish corporate commentary and potential earnings cuts.

Despite the recent fall in the markets, the optimism during the muhurat trading on Friday signified positive investor sentiment.

According to Vikas Gupta, smallcase Manager and CEO at Omniscience Capital, it is likely that the current correction in the markets is likely to start correcting itself in the next few weeks.

Possibly, somewhere between November 15 to January 15, the markets should start stabilising and demonstrate a definite trend, most likely positive,' according to Gupta.

At closing on Friday, Sensex was up 335 points or 0.42 per cent at 79,724 and the Nifty was up 99 points or 0.41 per cent at 24,304.

The global markets, including India, have been negative in October. This is most likely due to the uncertainty related to the US elections. This is the most important factor.

'The second factor would be the FII tax-loss trade in December to book losses for the year. Finally, the January effect, which is a positive return for the markets in that month following the loss-selling in December,' said Gupta.

As far as sectors are concerned, the best one for long-term value investors is the banking space, especially the PSU Banks. But the private banks, too, are available at significant discounts to their intrinsic values.

Besides this, the power sector, especially, select PSUs, and the IT sector looks attractive from a long-term investment perspective, said experts.

According to them, any reversal in FIIs' stance will require an improvement in domestic corporate earnings and attainment of fair valuations.

Of late, emerging markets are also consolidating ahead of the US presidential election and the upcoming Federal Open Market Committee (FOMC) interest rate decision, they added.

/IANS