Even though the year started with great expectations around economic reforms and revival, these hopes were belied to a large extent over the next few months. As a result, stock markets corrected sharply in the second half of the year, dragging down the benchmark indices nearly 15 per cent from their peaks.
"The main cause for the correction was global markets, which were hit by expectation of Fed raising interest rates and sharp fall in commodity prices, leading to capital outflows from emerging markets in general. The slowdown in corporate earnings growth was another factor that led to the downfall," says Manish Bandi, Head, Investments, IIFL Mutual Fund.
The debt crisis in Greece, which set global markets talking about return of the Drachma, an old currency of Greece, and the possible exit of Greece from the euro zone, also kept global markets wobbly. In spite of these factors, Indian markets exhibited a Buddha-like calm to begin with.
