Don’t Wait for the Dust to Settle

Market corrections are unsettling, but for seasoned investors, they are not unfamiliar. The ongoing volatility, fueled by global trade uncertainties and domestic economic concerns, has raised a pressing question: Is now the right time to enter the market, or should one wait for the dust to settle? The common instinct is to wait for clarity, but history suggests that markets rarely ring a bell at the bottom. More often than not, bottoms form amid chaos and uncertainty rather than in moments of tranquility.

The Market Landscape: A Slowdown with a Silver Lining

Economic and earnings growth have softened, and valuations have compressed, leading to heightened nervousness. However, despite these challenges, signs of stability are beginning to emerge. The Reserve Bank of India (RBI) has adopted a pro-growth stance, implementing measures to support liquidity and economic recovery. Meanwhile, global factors—particularly the shift in U.S. trade policies—are influencing investor sentiment worldwide.

The recent market correction, unlike previous black swan events such as the Global Financial Crisis or the COVID-19 pandemic, is the result of a mix of factors, including U.S. President Trump’s aggressive tariff policies, a strengthening dollar, and a tepid domestic earnings environment. With valuations retreating and foreign institutional investors (FIIs) pulling back, uncertainty has prevailed. But does this justify waiting indefinitely for a market bottom?

Why the Market Bottom Is Often a Mirage

A common mistake investors make is assuming that market bottoms form in a clear-cut manner, with a definitive signal to enter. In reality, bottoms tend to form in the midst of fear, pessimism, and uncertainty. Several factors make the idea of waiting for the perfect entry point an exercise in futility:

1. Markets Move Ahead of the Economy – The stock market is a forward-looking mechanism. By the time economic data confirms a recovery, markets may have already rebounded. Investors who wait for the perfect moment often end up missing significant upside moves.
2. Volatility Is the Norm, Not the Exception – Corrections are often followed by sharp rebounds, known as bear market rallies. These periods of volatility make it challenging to time the absolute bottom with precision.
3. Valuations Already Reflect Pessimism – Indian equities, measured by Nifty’s one-year forward earnings multiple, have already seen a valuation contraction. Historically, markets have bottomed at around 17.5x forward earnings (excluding black swan events), suggesting that further downside may be limited.
4. Foreign Fund Flows Are Unpredictable – A critical factor for emerging markets like India is the return of foreign capital. While global trade uncertainties persist, any shift in sentiment—such as a slowdown in U.S. growth—could reignite interest in emerging markets. However, timing this shift is nearly impossible.
5. RBI’s Growth-Driven Approach – The central bank has quietly introduced measures to support economic recovery, including liquidity injections and adjustments in risk-weighted assets for non-banking financial companies (NBFCs). These steps could pave the way for a gradual economic revival.

What Should Investors Do?

Instead of trying to predict the exact bottom, investors should adopt a strategic approach:

• Portfolio Clean-Up: Use bear market rallies to exit weaker holdings and consolidate positions in high-quality stocks.
• Gradual Accumulation: Rather than waiting for a perfect entry, start accumulating fundamentally strong stocks in a staggered manner.
• Long-Term Focus: Market downturns are temporary, but well-researched investments tend to yield substantial returns over time.

Conclusion: Don’t Chase Perfection, Embrace Strategy

While the temptation to time the market is strong, history shows that waiting for the perfect bottom can be a futile exercise. Markets tend to recover quietly, often when investors are still on the sidelines. Instead of being paralyzed by uncertainty, investors should focus on disciplined investing, leveraging volatility to build a resilient portfolio. In the long run, patience and strategy outweigh the elusive search for the perfect entry point.

Market this week

Source: BSE and NSE

• The Indian market ended its three-week losing streak to post the biggest weekly gain of 2025 in the week ended March 7, despite global volatility due to uncertainty around US trade policy.
• All sectoral indices closed in the green, with Nifty Metal surging 8.6%, Nifty Media rising 7.3%, Nifty Energy gaining 6%, Nifty Oil & Gas jumping 5.3%, and Nifty PSU Bank adding 5%.
• Foreign Institutional Investors (FIIs) remained net sellers, offloading equities worth ₹15,501.57 crore, while Domestic Institutional Investors (DIIs) provided strong support by purchasing equities worth ₹20,950.89 crore

Weekly Leaderboard

Source: BSE

 Stocks that made the news this week:

• Reliance Industries (RIL) surged over 3% on March 7, lifting benchmark indices as investor sentiment strengthened following an upgrade from global brokerage Macquarie. The firm revised its rating from ‘Neutral’ to ‘Outperform’ and raised the target price to ₹1,500 per share, indicating a potential upside of over 20%. Macquarie cited improving earnings momentum and the potential listing of Jio as key growth drivers. At 1:54 PM, RIL shares were trading at ₹1,249 on the NSE, marking the third consecutive session of gains, further supported by positive reports from Jefferies and Kotak Institutional earlier in the week.
• Jana Small Finance Bank shares soared over 12% on March 8 after receiving an Authorized Dealer Category-I (AD-I) license from the Reserve Bank of India (RBI) for forex operations. The stock climbed 12.22% to an intraday high of ₹491 on the NSE following the announcement. The bank, in an exchange filing, confirmed the RBI’s approval, allowing it to engage in foreign exchange transactions under FEMA, 1999. Despite the rally, Jana Small Finance Bank reported a 17.8% year-on-year drop in net profit for Q3 FY25, declining to ₹110.6 crore from ₹134.6 crore in the same period last year.
• Kalpataru Projects International Ltd (KPIL) surged over 5% after announcing fresh order wins worth ₹2,306 crore. The contracts include transmission & distribution (T&D) projects in international markets and building projects in India, bringing KPIL’s total order intake for FY25 to ₹22,500 crore. The company, a leading EPC player, operates across multiple infrastructure segments, including power transmission, buildings, water supply, railways, oil & gas, highways, and airports. With ongoing projects in over 30 countries and a presence in 75 nations, KPIL continues to strengthen its leadership through technical expertise and sustainability-focused operations.