Are we going through a healthy market correction or has the narrative changed? Vinod Karki answers

economictimes.indiatimes.com:

Vinod Karki, Equity Strategist, ICICI Securities, says the recent market correction appears to be primarily a response to the significant increase in US bond yields. Additionally, there are certain risks associated with economic growth, as evidenced by a noticeable deceleration in the economy. However, we attribute much of this slowdown to temporary factors such as elections and rainfall, which are likely to result in a postponement of demand until the latter half of this year. The predominant concern remains the escalation of bond yields and the prevailing optimism surrounding Trump, both of which have influenced market dynamics. Vinod Karki further notes that, in terms of overall market value, two sectors are distinctly prominent: large financial institutions and commodities.
What is your take on the market fall on Monday because this is definitely getting on our nerves. Firstly, it hit the traders, breaching the key support levels, and now the investors are a little concerned about the fall. What is your take on the fall that we are witnessing? Is it a healthy correction or do you believe something has really changed in terms of the narrative?
Vinod Karki: Fundamentally, the key reason why this is happening is the surge in US bond yields.

In September of last year, the US bond yield was around 3.6%. Currently, it is around 4.8%. So that is more than 100 basis points of increase.

Fundamentally, when bond yields spike, equity valuations contract and that happened last year. Around that point, we were 23 times on the Nifty. We are now a little below 20x, I guess.