Consolidation phase of NIFTY50 index indicates rational behaviour, but broader market euphoria is pushing related indices into unattractive valuation zone
NIFTY50 index is consolidating just below the 20,000 mark after rallying 14% from Mar’23 lows (modest 7% YTD return) while robust earnings expansion catches up, thereby indicating rational behaviour. However, bull market frenzy is visible in the mid, small and micro-cap indices, which have risen 25%, 29% and 42% respectively from Mar’23 lows.