Is the worst over? Mihir Vora on the market’s next big moves

«Some of the self-inflicted fundamental factors like RBI keeping liquidity tight, government going slow on spending in the first half, those are now getting unwound,» says Mihir Vora, CIO, Trust Mutual Fund.

Where markets are headed.
Mihir Vora: We had this good correction for five months and we had a smart bounce back. The correction had some reasons and maybe to some extent it was overdone so that overdone part is probably done. So, we have had the reset, I would say. I call it the reset in the market.

Some of the self-inflicted fundamental factors like RBI keeping liquidity tight, government going slow on spending in the first half, those are now getting unwound.
So, we have a good base of valuations and growth outlook to work from. And as we speak, apart from the uncertainties that you were discussing regarding the President Trump's actions, etc, for India the base is reset and we should be now looking at more normal kind of markets, barring unforeseen events in the global situation.


So, markets are oversold, they have come back. Valuations were expensive, they have corrected. But earnings are not going to come back. So, what happens to the market? I mean, earnings will take some time before they normalise, maybe two quarters and markets have already come back. So, then are we in for a pause phase for two or three quarters?
Mihir Vora: No, you might be surprised because if you notice, government spending has really gone down in the June 24 and September 24 quarters and that was a big drag on the overall