Equity Market Overview - August 2021

In this update on Indian equity markets, we discuss how are we poised and what may lie ahead.

Since the onset of Covid-19, Nifty has posted 12 months of positive returns out of total 16 months till July-21
Markets will be volatile in the near term and investors should be ready to face corrections from time to time.
The earnings delivery is expected to be robust in the medium term and will likely play out in the favour of the market.
The mid and small cap segments will continue their outperformance due to broad based recovery
Valuation across market capitalization are currently not cheap but also not unusual for the current stage of the cycle
Comparing large-cap, mid-cap and small-cap segments within a sector and not at the index level, is the right approach to adopt.
Investors should be cognizant about their risk appetite, existing asset allocation and time horizon of investment.