Bears Stranglehold: Will markets fall 10% and should you worry?

"Simply on the basis of where we stand on market multiples even now, I wouldn’t rule out another 10% correction. But the adjustment on account of election results is done. If the NDA is forming the next government with PM Modi, then markets will remain reasonably assured," Ambani said.

Big bulls like and Raamdeo Agrawal also see ahead of themselves. While the former is a Chairman of the , the latter is ' (MOFSL) Chairman & Co-Founder.

Mobius, who is also Chairman of the Mobius Emerging Opportunities Fund, sees a 15-20% correction as normal on the back of election results. In a chat with ETNow, he had spoken of the likely correction if the outcome was to be not as per the expectations of the Street. In his view, Indian markets are due for a correction having gone too far too soon.

Boutique asset management firm expects markets to remain choppy, with bouts of sharp movements on either side in the near term. Corrections should continue in stocks running much ahead of their fair value and those which have moved up sharply recently just on hope and conjecture, it said in a note. However, the would subside as more clarity comes on and also the narrative of the government post the not-so-favourable election outcome.

Fear index shot-up to 31.71 on Tuesday as Street was displeased with a weaker than expected outcome, registering an intraday jump of over 50% which was the highest single-day jump in 9 years.

However, on Wednesday, markets witnessed a sharp recovery after it was almost clear that the NDA would form the government. As per unconfirmed reports, Modi was likely to take oath as the Prime Minister on June 8.

As a result, the India VIX hit an intraday low of 18.68, which was a substantial climbdown from the Tuesday closing levels of 26.75. At 12:50 pm India VIX was hovering near 19.54, lower by 27%.

MOFSL's Agrawal said that even if the markets were to correct by 10-15% in this period, he would not mind them correcting 10% further. "...that absolutely is like it is a ground zero and then we start with a new administration and new thought process and new 100 days, new ambitions of the government, new ministers and they will come and run for their targets and things like that and then the new energy in the economy will also come," he said as he expects markets to accelerate to the new highs.

Ambani's recommendation to investors is to be mindful of and buy reasonably priced companies with high earnings visibility. "This is not the time to pay big premiums on stocks, or buy only in the hope of future reform," he opined.

This analyst does not see it as the end of the .

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