According to Divam Sharma, co-founder of Green Portfolio, market sentiment appears to be nearing peak pessimism, with much of the negative news surrounding crude oil prices, the rupee, interest rates and foreign investor outflows arguably already priced in.
Valuations have corrected meaningfully from their highs, while domestic flows through systematic investment plans (SIPs) and institutional investors continue to provide a cushion to the market. These factors could help markets form a base over the coming weeks, although any recovery is likely to be gradual rather than sharp, he said in an interview with Moneycontrol.
Amid the ongoing correction in the broader market, Sharma sees signs of capitulation, with significant erosion in valuations across parts of the midcap segment and broad-based selling pressure. Historically, such phases tend to flush out excesses and create opportunities in fundamentally strong businesses, he said.
Do you believe the market will find a bottom in the next few weeks?
Sentiment appears close to peak pessimism, and much of the negative news around crude, the rupee, rates and foreign outflows is arguably already in the price. Valuations have corrected meaningfully from their highs, while domestic flows through SIPs and institutional investors continue to provide a cushion.