Some Macro Factors Currently being faced impacting the Indian Stock Markets

1.    Falling Indian rupee against the US dollar

A falling Rupee further increases the import bill and increases inflationary pressures on the economy.

2.    Rise in crude oil prices

India is heavily dependent on crude oil imports. Higher crude oil prices widen India's trade deficit.

3.    Tradewar between US & China

The US-led trade war against China have escalated tensions and uncertainty in global trade. Since March 2018, US President Trump has been sounding the trade war bugle by announcing tariffs on imports of various goods. Being the biggest importer in the world, such protectionist measures by the US are a big negative for global trade.

4.    Rising interest rates in the US as well as India

After years of near-zero interest rates, the US Fed has been raising interest rates. This has resulted in an withdrawal of capital flow back into dollar denominated assets. Foreign investors have been selling Indian equity and debt instruments.

In June 2018, the RBI raised the policy interest rates for the first time in four years. For four years, the central bank had either reduced interest rates or maintained status quo.

5.    Election year uncertainty

The 2019 general elections are some time away. If the Modi-led BJP government fails to win another mandate, it will weigh negatively on the markets. Also, there are concerns that the government may take populist measures to woo the vote bank and adversely impact fiscal health.

6.    Indian banking and NBFC Issues

For some time, the Indian banking system has been grappling with the NPA crisis. And every time you think it's the end of the tunnel, there's more mess to be discovered.

Last week , the Indian stock markets had a stormy session as the shares of NBFCs, particularly housing finance companies, came under sudden heavy selling pressure. One of the reasons for this sell-off was linked to the recent financial stress in the Infrastructure Leasing company space . Also losses in leveraged positions are leading to selling in other stocks to cover those setbacks .

7.    High valuations

While on one hand, the Indian corporates are on the path of earnings recovery, there's not very encouraging news coming from many fronts that's taking the wind out of the market.

But it's important to recall the flood of domestic liquidity and optimism had pushed stock prices through the roof. Indian stocks were trading at unsustainably lofty valuations.

The ongoing market correction has and will bring several stocks down to more reasonable valuations.

Well where the markets are headed is not anyone can predict but these are some of the factors which need to be addressed which can have a positive movement on the market which will make everyone happy . Happy to hear the expert opinions and perspectives of people who do this for a living or follow it closely .