Markets across the globe have overreacted. Period.
Japan ‘raised’ just 0.25 bps rates & the world is reacting as if it’s the end of the world. (My experience says: Nobody will care about this next year).
Let’s not forget, the rates ‘cuts’ across the world are coming sooner or later. (Sooner I think). Bank of England already started cutting rates last week. US Fed, EU & India are likely to follow the suit in a month or two.
Anyway, today’s overreactions are a blessing in disguise. (Honestly, I was discussing with my research team on Friday that we’ll love a correction to buy quality shares at reasonable valuations but didn’t thought Nikkei would tumble like this).
Anyway, today’s correction was must needed after the excesses we’ve seen in some pockets.
Sanity will prevail in the markets.
Thank god market didn’t overstretched it’s rally beyond 25,000 in a one way linear direction.
Just remember, we went from 15,000 to 25,000 nifty from 2022 to 2024. In just 2 years. Logically, a 2000-4000 points drop should be acceptable from the top.
Also, corrections in bull markets are must needed. It removes the froth. It removes the excesses & exuberance. In fact, this kind of corrections add more legs to the secular bull run.
I’ll keep buying the dips gradually as & when (if they ever) come.
My confidence in current secular bull run just increased.
