Brace for another leg down: Another correction may be on horizon, warns Manishi Raychaudhuri

correction as concerns around high valuations, earnings downgrades, and macroeconomic uncertainties come to the forefront. According to Manishi Raychaudhuri, a prominent market strategist, the next couple of months could be challenging for investors as multiple headwinds converge, including the impact of global trade developments, sector-specific earnings pressures, and stretched market valuations.

In an interaction with ETNow, Raychaudhuri said he expects the Indian market to correct in the short term, pointing to the upcoming result season and the likelihood of widespread earnings estimate downgrades across key sectors such as IT, consumer discretionary, industrials, and staples. He also flagged potential currency weakness and a rise in equity supply as additional short-term concerns that could weigh on market sentiment.

“If you look at, let us say this quarter or the next two months or so, I would expect the Indian market to correct,” he said. “I actually recently published a report saying that brace for another leg down,” he added, pointing to weak earnings expectations as the key trigger.

While global developments such as tariff-related sentiment shocks have impacted market sentiment, Raychaudhuri said he is more worried about the result season and the consequent earnings estimate downgrade that most of the sectors are likely to suffer.

He added that sectors like IT, consumer discretionary, industrials, and staples may all report delayed recovery timelines, leading to downward revisions in estimates.

Live