The US-Iran standoff can pull down Indian equities and small caps are expected to be dominant investment themes in the markets, ICICI Prudential Mutual Fund said on Monday.
The extent to which geo-political tension in the Middle East can hurt the domestic markets, however, cannot be predicted, the second largest asset manager's chief investment officer S Naren told reporters here.
The small cap segment is set to dominante the landscape for the next three to five years, after under-performing for two years, he added.
The large caps are extremely over-valued at present making them a no-go area, despite the vital roles that the companies are playing, he said.