India is increasingly emerging as a new stable core in a volatile global environment, even as geopolitical tensions and energy shocks continue to rattle financial markets
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NEW DELHI — India is increasingly emerging as a new stable core in a volatile global environment, even as geopolitical tensions and energy shocks continue to rattle financial markets, according to the latest monthly note by Quant Mutual Fund.
The fund house, led by Sandeep Tandon, highlighted that recent military actions involving the United States and Israel against Iran triggered a broad-based correction in global equities.
Key indices such as the S&P 500, Nifty 50, Nikkei 225 and KOSPI witnessed declines, while bond yields moved higher and commodities turned volatile.
The note added that the VIX Index, often referred to as a fear gauge, surged over 75 per cent earlier in the month, reflecting heightened uncertainty among investors.
Despite the global turbulence, Quant Mutual Fund pointed to stress in domestic markets as a possible inflection point rather than a sign of deeper trouble.
The fund house observed signs of “capitulation” in Indian equities, suggesting that the worst phase of the correction may be behind.
It emphasised that elevated volatility should not be mistaken for market dysfunction, but rather seen as part of a natural adjustment process.
Maintaining a constructive outlook on India, the fund house noted that the country’s nominal GDP is growing at nearly twice the pace of China’s, reinforcing its position as a preferred global investment destination.
It expects the earnings cycle to improve in the coming quarters, supported by ongoing reforms and macroeconomic stability.
Reflecting this optimism, the fund house has increased its equity deployment, taking advantage of attractive valuations after maintaining higher cash levels in the previous month.
Its portfolio remains largely tilted towards large-cap stocks, with selective additions in mid- and small-cap segments.
On the sectoral front, Quant Mutual Fund remains positive on energy, large infrastructure, NBFCs, insurance, asset management companies, private sector banks, hotels, pharmaceuticals, telecom and consumption-driven themes such as FMCG and food processing.
However, it has maintained an underweight stance on manufacturing, citing uncertainties related to input costs and supply chain disruptions.
Looking ahead, the fund house believes the current phase of volatility could evolve into one of the most significant buying opportunities since the COVID-19 pandemic.
It advised investors to closely track extremes in market sentiment to identify opportunities and rebalance their portfolios accordingly.