Is Nifty finally bottoming out? Here’s what Mayuresh Joshi has to say

economictimes.indiatimes.com:

Mayuresh Joshi, Head Equity, Marketsmith India, says we are either very close to reaching a market low, or the market expects that earnings downgrades will mostly end as we enter Q4 or Q1. This has been a positive factor for the market in recent years. In the entire Nifty 500 index, only 15 stocks are currently trading above their 200-day moving average. Historically, during similar situations in 2008, 2014, or even during the COVID crash, the market typically finds its bottom in the following weeks, months, or days, depending on the timeframe.
What should one make of this market? The market has been a bit range-bound in the last two to three trading sessions. How should one strategize for the future? What should the strategy be, given that a large part of correction is done for the SMIDs?
Mayuresh Joshi: We have just recently published a few data points, which are sounding a little bit more optimistic as we speak. So, we have actually done three-four analyses. One, in terms of the bond yield and the Nifty earnings yield, this has largely contracted and this is coming up around 1.8, 1.9, in terms of the spread between the earnings yield and the bond yield.

What is it processed to? A large part of the move probably gets gestated; so, very close to that. So, either we are very close to forming a bottom or the expectation of the market that the earnings downgrades should largely be over as we hit Q4 or Q1, so that is one parameter where over the last few years we have seen that has worked well in favour of the market.