'We live in a globalised world and thus investors should worry about global interest-rate developments'

After falling due to rising interest rates worldwide, the Indian markets have smartly recovered. 

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However, correction is still going on in developed markets. Amid this scenario, we speak with Niket Shah, Fund Manager, Motilal Oswal AMC, about the market outlook now. Shah co-manages Motilal Oswal Midcap Fund, which has assets of over ₹3,000 crore (as of August 2022). He also tells us how he manages this fund, which has been one of the top performers over the last one year. He shares his perspective on investing in companies with high debt on their balance sheets, among other things.

The markets have smartly recovered after the brief meltdown caused by rising interest rates. What's your short- to medium-term outlook for the market now?

Markets have moved up smartly and are hovering near the previous highs. In the short term, markets could remain volatile as not all headwinds have eased. While commodity prices are moving lower, which should ease inflation concerns, the growth outlook too is deteriorating, especially on the external front. China's growth slowdown, real-estate slowdown, and geopolitical risks related to Taiwan remain key risks. This in turn could keep markets on tenterhooks, especially given the rally and market valuations.