With West Asia tensions flaring again, US inflation at a three-year high, and the Fab-7 tech giants starting to crack, the global environment has turned markedly less friendly for Indian equities. Harsha Upadhyaya, Chief Investment Officer – Equity and President at Kotak AMC, spoke to ET Now to lay out how he is navigating the turbulence, sector by sector.Upadhyaya was candid about the macro picture. The Iran-US conflict has resurged contrary to expectations, yields are rising globally, and markets that rode the AI wave higher are now unwinding some of those gains. "Everything is coming together and it is not great support for Indian markets," he said, while noting that India's limited participation in the AI-led tech rally may cushion it somewhat from a one-to-one correction if US tech sells off sharply.US tech correction won't benefit Indian ITOn Indian IT services, he pushed back against the idea that a US tech correction would directly benefit India. The real problem, he argued, is a structural slowdown in discretionary IT spending, which is suppressing year-on-year growth regardless of what happens to AI stocks in the US. High dividend yields and potential buybacks may limit the downside, and a reversal of short positions stacked against Indian IT could generate a tactical bounce, but the business fundamentals are unlikely to shift meaningfully in the near term."From a business perspective, I do not think anything is going to change for IT services even if there is some reversal in the stock market performance of AI stocks," says Upadhyaya.On FII flows returning to India in a meaningful way, Upadhyaya struck a measured tone. Full-year earnings growth expectations of around 14% are likely to face downgrades as the war continues, potentially settling at lower double digits. At that level, India's relative premium valuation versus other emerging markets makes it a harder sell for foreign investors, even if the picture looks better than it did a few months ago.You Might Also Like:Take some money out of metalThe metals pack, which has seen sharp stock outperformance, drew a note of caution. Upadhyaya acknowledged that supply disruptions and higher energy costs have supported metal prices, and that Indian companies enter this cycle with far cleaner balance sheets than in previous downturns — giving them greater resilience. However, with global demand showing no meaningful uptick and stocks already pricing in much of the good news, he advised against extending positions further at current levels."Given the very strong short-term performance from most metal names, it would be prudent to take some money out or not extend your positions," he said.Pharma & healthcare a sure betPharma and healthcare emerged as Upadhyaya's clear positive conviction. With traditional defensives like IT and consumer staples facing their own structural headwinds, he said pharmaceuticals — including hospital services — now stand out as one of the few genuinely defensive pockets available. Kotak AMC is positioned neutral to overweight across its portfolios in this space, backed by bottom-up comfort on strategy and profit trajectory in select names.You Might Also Like:"There are not too many defensive sectors left today. Pharma and healthcare, including hospital services, become a good choice if you want to tilt your portfolio towards safety," said Upadhyaya.On textiles, he acknowledged brighter prospects from the latest PLI round and easing tariff headwinds, but flagged limited liquidity in the sector as a constraint for institutional-sized positions. On gold-linked equities, he remained relatively calm — the recent volatility in bullion has dented sentiment in gold lenders and jewellery names, but is not yet severe enough to threaten lending books or volume growth, provided gold prices stabilise in a reasonable range.Kotak AMC sector positioning at a glancePharma & HealthcareOverweight / Positive: Top defensive pick; hospitals includedIT ServicesCautious: Tactical bounce possible, but no business catalystYou Might Also Like:MetalsTrim / Don't add: Strong rally priced in, demand recovery absentTextilesSmall positions: PLI tailwind but limited institutional liquidity