The stock markets capitulated this week. The fears were largely overdone. The sharp dip in OMCs clearly indicates the symptom. The markets are clearly gripped by the fear of loss. And, investors dump every stock where they fear further loss. And the very risk aversion they display is causing huge losses to investors.

The disconnect between decision making and value is stark. Large caps losing almost 30% in just two trading sessions is now becoming a regular feature. The most valuable index bellwether lost 12% in just two trading sessions. The cracks are widening and sentiment could well capitulate unless something calms nerves and eases the fears. Results of the better-performing companies can do their positive bit. But, even that may not last for too long.

Not everything is lost yet. Contrarians will definitely show up in this market. The coming weeks could well be their best outing. A year later, this phase will be part of folklore. But, standing out and counting on conviction is not going to be easy. The time when greed bests fear was never meant to be easy. The coming weeks will prove that for the umpteenth time.

Happy investing!

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