Stock Market Correction not proportionate to rise

Correction is not really that large as compared to the rise in stock markets. We are still bullish on the long-term India story and would use any correction to buy at a gradual pace.

The stocks market have moved up sharply, an almost 20% rise in less than four weeks, especially after the September 18 Fed cut. The rate of the rise or run up in the market was a bit of surprise and a bit of worry for us. The correction that we have seen is not really that large in the context of the rise that we have seen. To that extent, we are still bullish on the long-term India story. We would use any correction to buy at a gradual pace.

What the stock markets would like to understand is the roadmap more clearly and whether existing positions on the derivative sides are going to be allowed to be rolled over. I think that is the most important point on which people are worried about.

We keep talking to a lot of stock market intermediaries all the time and there was a feeling of being left out especially on the part of a lot of long-only guys, who have been in India for the last 5-10 or more years. The pace at which the market was going up resulted in a lot of them getting incremental money but they were unable to deploy because of the pace of the ride. They may be still there on the sidelines. This is the kind of money that the Finance Minister referred to as being buying in the stock markets may be today or on any sharp correction.