Investors should moderate their return expectations, says Mirae Asset CIO
Subscribe to enjoy similar stories. The market benchmark indices – Nifty50 and BSE Sensex – have each corrected about 13% from their highs last September. Weak corporate earnings, concerns of a US-led tariff war and continued selling by foreign portfolio investors (FPIs) have all contributed to weakness in the market.
Neelesh Surana, chief investment officer at Mirae Asset MF, who oversees ₹1.5 trillion in equity assets, explains how investors should navigate current market volatility, his outlook, and why the fund house is launching a small-cap fund now. Here are some excerpts from an interview. The rally that began around March 2023 has now seen its first serious drawdown, with the Nifty 500 Index correcting by about 15%.
Sectors that experienced significant gains over the past two years saw sharper corrections, thereby adjusting previous excesses. Concerns around domestic GDP growth and corporate earnings have weighed on investor sentiment. Both GDP growth and corporate earnings were soft in the September quarter and could continue to be weak in the December quarter.
On the global front, the probable impact of US policies under the new Trump administration has played a significant role in FPI outflows, as these policies have implications for global interest rates and the strength of the US dollar. FPIs have sold a massive $19 billion since October 2024, including more than $7 billion in January alone. Of course, the full extent of FPI selling has been absorbed by DIIs, creating a sharp contrast between the actions of these two broad sets of investors.
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