News Topical, Digital Desk : With ongoing tensions in West Asia and crude oil prices rising above $100 per barrel, stock markets are expected to fall further. In a Moneycontrol report, Vikas Khemani of Carnelian Asset Management estimated that the current situation could lead to a market decline of up to 10%, but this is not a reason for investors to panic, but an opportunity to invest. Domestic markets have already lost about 5% since the attack on Iran began.
Potential impact on Indian markets
Regarding the impact on Indian markets, Khemani said that short-term pressure is almost certain, but India's long-term growth story remains strong. There are two main risks in the short term: impacts on the global supply chain and a sharp rise in crude oil prices. According to Khemani, under current circumstances, Indian stock markets could decline by 5 to 7 percent. If crude oil prices fall further, the decline could reach up to 10 percent.
What are the signals from the war? Khemani said that despite the attacks on Iran that killed several top leaders, Iran's continued retaliation indicates that the conflict is not going to end soon. This is causing pressure on the market. He explained that the unfolding developments indicate that the conflict may last longer than previously expected. Iran has suffered heavy losses in its leadership, but the continued retaliatory attacks indicate that tensions will not ease soon. He also said that in such circumstances, it is extremely difficult to make any accurate predictions. In such a situation, uncertainty reigns.
What should investors do? He said that despite these risks, the fundamentals of the Indian economy remain strong, and the domestic growth story remains unchanged. According to Khemani, India has delivered long-term returns of approximately 17-18 percent CAGR to investors, and globally, it remains a highly attractive investment opportunity. He clarified that those who remain invested in the market should not withdraw money simply out of fear. Even if they do, they can take advantage of the many opportunities available in the market.
Read More: Stock market crash: 'Will the stock market fall by -10%? This is where investors' opportunity lies.'
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