“Wait and watch.” This is broadly the advice that investment officers and fund managers are advising retailers to do as asset management companies are sitting on cash, waiting for the noise surrounding the US imposition of tariffs to die down.

“Too many moving parts,” said Sandeep Bagla, Chief Executive Officer of Trust Asset Management. “Investors are sitting on cash and its too early to arrive at conclusions,” he pointed out.

“We have cash… till there is clarity on growth and on the resolution of tariffs, we are going to hold on to cash,” he added.

Indian equities are on a free fall with the benchmark indices down over 4.5 per cent. The broader markets such as the small caps and mid-caps are even further down, while among the sectors, IT and auto stocks bore the brunt of selling. Among the auto stocks Tata Motors was the worst affected falling over 8 per cent, with UK subsidiary Jaguar Land Rover saying that it would pause US shipments in April.

Though stock prices have corrected steeply, investors are being told to wait as there is high uncertainty whether the market can correct further in future sessions. Small and systematic investments are still the best way to ride out the current volatility.

“My systematic investments would continue but the lump sum investment would wait. I will get better opportunities in this volatile time,” said Manish Jain, Chief Strategy Officer & Director, Mirae Asset Capital Markets.

He pointed out that irrespective of strong earnings, stocks are continuing to get hammered and there was nowhere to hide.

While some sectors could be affected more than others, in the general gloom the entire market was seeing a sell-off.

“Let’s not overthink. We are going through a jungle, and we don’t know what or who is lurking around,” said Bagla.

India has the advantage of being less dependent on exports and deriving over 60 per cent of its output from domestic consumption, giving the economy some kind of a natural cushion from global trade shocks.

Published on April 7, 2025