The benchmark Sensex slipped over 3000 points in the last two weeks triggered by the new Covid variant in South Africa, valuation concerns in the Indian equities and tapering of bond purchases by the US Fed. Investors are dumping Covid-sensitive stocks and foreign brokerages have downgraded India early this month on high valuations as the Sensex forward one-year price-to earnings (PE) is at 21.76, higher than five-year average of 19.13.
While the focus of foreign institutional investors have been shifting from premium Indian equities to relatively cheaper markets indicating profit booking—last week they sold Indian stocks worth over Rs 23,000 crore—existing retail investors should not assume that the recent historical returns will be
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