A 5-10% correction is pretty normal for equities, so I am not really perturbed by the same. It can be attributed to mostly global factors viz. the geopolitical situation in Israel and Ukraine, oil prices remaining high and interest rates in the western world continuing a rising trajectory.
Mid-cap and small-cap space will always be a stock pickers’ playground. This is because most of the exciting sectors where we expect high growth are represented only in the mid and small space, says Mihir Vora of TRUST Mutual Fund.
Interest rates in the US and developed world are likely to remain higher for longer as inflation and growth are both higher-than-expected, especially growth, says Mihir Vora.
The value of trades in the interbank call money market, which helps lubricate the financial system and is the operating target of the RBI s monetary policy, has shrunk nearly 40% in the past four years, official data showed. Meanwhile, trades in the two other money market segments - market repos and tri-party repos - have trebled, posing a tricky question for the RBI about its rate-action impact on the economy.
Biggest thing is that you are getting 5% on the US 10-year bond so that obviously is going to suck away some amount of risk capital out there and the fact that when they go underweight China, they relatively need to rebalance the other countries also. So, probably we are seeing some rub-off of that also, I would guess.