Nifty ends 4-month slide; 40% rally possible
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- Nifty 50 ended a four-month decline in March 2026, a streak that has occurred only seven times in the index's full monthly history, with the recent selloff totaling 14.8%.
- Across six completed cases of four-month-plus losing streaks, the index delivered average returns of 40.7% over the following year and a median gain of 20.8%, per DSP Mutual Fund.
- ICICI Prudential's Balanced Advantage Fund raised its equity allocation to 61.9% as of March 31 — the highest level in nearly five years — with assets of Rs 71,150 crore; CIO S Naren called it an appropriate time to gradually increase equity exposure.
- Quant Mutual Fund described the setup as "potentially the biggest buying opportunity since Covid" and said it is "seeing signs of capitulation in Indian equities," urging investors to rebalance aggressively.
- Historical episodes show longer declines produce stronger rebounds: the post-January 1991 streak produced a 117.9% one-year gain, and the August 1998 case accelerated from 10.4% at six months to 65.6% at year-end.
- Quant Mutual Fund repositioned its portfolio, tilting toward large caps with select mid- and small-cap exposure, while remaining underweight manufacturing due to input cost and supply chain uncertainty.
Why it matters: Two major mutual funds are voting with their capital: ICICI Prudential's flagship balanced fund now holds its highest equity level in nearly five years, and Quant is deploying from previously heightened cash levels. The last time ICICI Prudential held more equity (67.7% in June 2020) marked the start of a massive post-Covid rally.
