India’s stock markets have been facing a downward trend for the past five months, primarily due to factors such as continuous selling by foreign institutional investors, geopolitical tensions, high valuations, slowing economic growth, and mixed corporate results. This uncertainty has led to sustained selling pressure, resulting in a bearish sentiment in the domestic equity markets. Since their peak on September 26, 2024, major indices like Nifty 50 Total Return Index (TRI), Nifty Midcap 150 TRI, Nifty Smallcap 250 TRI, and Nifty Microcap 250 TRI have corrected by -15%, -21%, -25%, and -24%, respectively.
Among the sectoral indices, Nifty Energy (-31%), Nifty Realty (-30%), and Nifty PSE (-27%) witnessed the most significant corrections, while Nifty Financial Services (-8%), NIFTY IT (-11%), and Nifty Bank (-11%) managed to hold up relatively well.
Equity mutual funds have also been impacted by the market correction, with schemes having international exposure, defensive stock weight, larger cash positions, and effective sector rotation experiencing comparatively lower corrections. Top three equity schemes that saw the most correction during this period were Samco Flexi Cap (-29%), Mahindra Manulife Small Cap (-26%), and HSBC Small Cap (-25%). On the other hand, schemes like Parag Parikh Flexi Cap (-7%), Motilal Oswal Large Cap (-10%), and Motilal Oswal Multi Cap (-10.2%) showed resilience and managed to minimize the impact of the market downturn.
Here is a list of equity schemes across major categories that have seen relatively less decline from their peak on September 26, 2024, as of March 1, 2025:
- Parag Parikh Flexi Cap
- HDFC Flexi Cap
- Motilal Oswal Multi-Cap
These schemes have demonstrated resilience in the current market crash. The data and analysis provide valuable insights for investors navigating through the challenging market conditions.
