Market expert Rohit Srivastava has issued a cautionary warning about equity investments, advocating for substantial cash positions as global markets face mounting uncertainties. The founder of Indiacharts & Strike Money is currently maintaining 100% cash on a personal level while recommending clients hold between 30% to 50% cash positions.

Early Signs of Major Market Reversal

Srivastava believes global equity markets are experiencing the initial phases of a significant trend reversal. Speaking to CNBC-TV18 on Tuesday, he emphasized that what initially appeared as trade-related concerns have evolved into broader geopolitical challenges.

"We are in very, very early stages of what might end up being a major or significant trend reversal in global equities. It's been a good ride, but I think it's gone away from what looked like only about trade to becoming a geopolitical problem," Srivastava explained.

Given that geopolitical issues typically require extended periods to resolve, he anticipates a multi-month phase of market uncertainties ahead.

Indian Market Performance and Wealth Erosion

Indian equity markets have experienced substantial declines from their recent record highs, with the Nifty 50 index retreating significantly from its January 2 peak. The market correction has resulted in considerable wealth destruction across BSE-listed companies.

Global Market Pressures and Trump's Tariff Threats

The current market selloff has been amplified by renewed tariff rhetoric from US President Trump, who has threatened to impose a 10% tariff on European allies. These threats are specifically targeted at nations that do not support his plans regarding Greenland, the self-governed territory under Denmark's jurisdiction in the Arctic region.

The geopolitical tensions have created risk-off sentiment across global markets, with US futures also declining sharply while Wall Street cash markets remained closed on Monday due to a holiday.

Strategic Recommendations for Investors

Srivastava advocates for a defensive approach, urging investors to prepare for potential downside scenarios rather than being caught unprepared. His strategy emphasizes capital preservation over potential gains in the current environment.

"In short, it is not a good time to be in equities. You should create as much cash as you can," he stated.

The chartist specifically recommends preparing for a 10-20% downside in global equities, emphasizing the importance of preparation over speculation about the extent of potential declines.

"So, you should prepare for 10-20% kind of downside in global equities. And it's better to prepare for that. Sometimes people will come in and question, will it be so much or will it be that much? What that approach does is it doesn't help you to prepare. So, I would say prepare for the worst and then let's hope it doesn't get that bad," Srivastava concluded.

Indian equity markets are experiencing challenging conditions, with weak sentiment and sustained foreign institutional investor selling creating headwinds for investors. Despite the broader market weakness, market experts suggest focusing on selective opportunities with strong earnings visibility.

Market Outlook and Investment Strategy

Sunny Agrawal from SBI Cap Securities emphasizes that current market weakness should not distract from fundamental investment principles. He advocates focusing on companies likely to report healthy earnings growth over two to four quarters, using market volatility as an opportunity for gradual deployment of capital.

The market pressure stems primarily from muted performance in index heavyweights and ongoing geopolitical tensions. However, select pockets within various sectors continue demonstrating strength, offering targeted investment opportunities for discerning investors.

Banking Sector Highlights

Within the banking space, mid-sized banks have emerged as bright spots. Federal Bank and Catholic Syrian Bank have reported strong numbers, with Catholic Syrian Bank providing particularly robust provisional updates. This performance underscores the importance of stock-specific analysis rather than broad sector generalizations.

Auto Sector Positioned for Growth

The auto and auto ancillary sector stands out in the current environment, supported by strong December quarter volume growth and positive medium-term projections. Industry outlook through FY27 appears robust for auto OEM companies, creating favorable conditions for ancillary players.

Recent corrections have made valuations attractive in several auto ancillary names, including Belrise Industries and Pricol. These quality stocks present opportunities for investors with 6-12 month investment horizons.

IPO Performance Analysis

Bharat Coking Coal's strong debut performance reflects multiple supporting factors. The company was priced attractively at approximately 6.5 times EV-to-EBITDA, significantly below peer valuations of 10-12 times. The low issue price and smaller issue size of around ₹1,000.00 crore, combined with limited retail allocation of 35.00%, contributed to the robust listing performance.

The company serves as a proxy play on steel sector growth, with coking coal demand expected to rise alongside steel industry expansion. While listing gains present booking opportunities, long-term investors can expect 12.00-14.00% CAGR returns.

Metals Sector Dynamics

Silver prices have experienced exponential growth, significantly impacting Hindustan Zinc's performance. Silver now contributes approximately 40.00% of the company's profitability in the previous quarter, highlighting its importance as an earnings driver.

However, caution is warranted regarding silver price sustainability. The sharp spike appears driven by Chinese supply restrictions and speculative activity rather than fundamental demand changes. Ground demand remains unchanged, suggesting potential correction risks from current elevated levels.

Investment Recommendations

For 2026 positioning, TVS Motor emerges as a preferred auto major, benefiting from strong presence in two-wheeler and three-wheeler segments expected to continue performing well.

Pricol Industries represents an attractive mid-cap ancillary play with fair value estimated at ₹850.00. The company leads in driver information systems and fluid management control systems, with growth drivers including:

• New disc brake products becoming mandatory
• Recent plastic moulded business acquisition
• Strong market position in specialized systems

Strategic Approach

In the current uncertain market environment, the recommended approach emphasizes selectivity and earnings visibility. Investors should focus on quality names with strong medium-term prospects, using market volatility as an opportunity to accumulate positions in fundamentally sound companies with clear growth trajectories.