Why markets are plunging? Blame poor corporate earnings, high bond yields

The benchmark Sensex companies' underlying earnings per share are down 3 per cent (on a cumulative basis) since January 2015, against 25 per cent rise in the index value during the period

The latest correction in global equities, including in India, can be attributed to two factors: Poor growth in corporate earnings and a steady rise in bond yields or interest rates in the world’s major financial markets, especially the US.

Analysts say while poor corporate earnings made it tough to justify rich valuations on the street, the rise in rates lowered the relative attractiveness of equities over less risky assets such as fixed income and fixed deposits in banks.

“The latest correction has nothing to do with economic conditions but it is largely a reaction to the massive build-up of market