Given how the benchmark indices have been holding up, it might seem like all\u2019s well with India\u2019s stock markets. However, just five stocks \u2014 Infosys, TCS, HDFC Bank, HDFC and Kotak Mahindra Bank (KMB) \u2014 have accounted for two-thirds of the gross up-move of the Nifty with Reliance Industries being the sixth driver. Worryingly, as much as 70% of the addition to market capitalisation of these stocks has comes from a re-rating \u2014 an expansion of the multiples. \u201cThe re-rating of a small quality corner of the market has to be finite and cannot hold up the index indefinitely,\u201d strategists at Bank of Merrill Lynch wrote recently. The Nifty has gained 1.5% since the start of the year. At a broader level, more than three-fourths of the stocks that comprise the BSE 500 or 392 of them are in the red and about one third are down more than 20%. The market capitalisation of the BSE may be up around 4.5% since January but again that is thanks to the performance of a few stocks. \u201cThis concentration of performance is troubling,\u201d the strategists wrote recently. They added an improvement in the Nifty\u2019s breadth would require not just absolute earnings growth but also outperformance vis a vis earnings estimates. However, that does not seem likely in the near term, given the several headwinds to the economy. Earnings for the Nifty set of companies were down 9% y-o-y in Q4FY18. At 13.6%, the operating profit margin for a sample of 1,528 companies in Q4FY18, was the lowest in at least eight quarters; the OPM contracted by 114 basis points. Excluding other income, the net profits for the sample actually fell 2.6% y-o-y compared with an increase of 24% y-o-y in Q3FY18. \u201cThe Q4FY18 results were generally below expectations and have resulted in moderate downgrades to FY19 and FY20 net profit estimates,\u201d Sanjeev Prasad,MD, Kotak Institutional Equities wrote. A BofAML study of a set of 1,600 equity funds in India showed only 3% had outperformed the Nifty in the first six months of the year. With equity sales of $3 billion in three months, foreign portfolio investors (FPIs) are clearly not comfortable with India\u2019s macros and markets. In the first six months of 2017, they had bought $8 billion worth of stock; this year the number is nudging $1 billion so far. The economy faces several headwinds in rising crude oil prices \u2014 a $10 per barrel rise in prices is tantamount to a tax of $15 billion tax on Indian consumers.