Vinod Karki, Equity Strategist at ICICI Securities, highlights market trends with a focus on domestic cyclicals, defensives, and FPI buying behavior. He anticipates a tapering down of earnings growth from a low base, emphasizing the importance of maintaining valuations in the market. Karki points out that DIIs and FIIs being an equal footing in terms of net buying is keeping our markets relatively expensive .
"Given that our domestic economy is growing at a decent rate, the investor community currently believes that every market decline is a buying opportunity and is, thus, investing heavily. However, as the saying goes, “if there is value, buyers will find you in the middle of the ocean, in the dead of the night.” Hence, if the markets have growth and reasonable valuations to offer, both FIIs and domestic inflows will continue."