Broader market outperformed the headline indices with BSE Midcap and Smallcap finishing the day 1.22%, and 1.54% higher, respectively
Capital markets regulator Sebi has permitted mutual funds to again invest in foreign stocks within the aggregate mandated limit of $7 billion for the industry. This came in the wake of a major correction in global markets that brought down the valuation of international stocks. In January, Sebi had asked mutual fund houses to stop taking fresh subscriptions in schemes investing in overseas stocks. The directive to stop subscription was mainly on account of the mutual fund industry crossing the mandated limit of $7 billion for overseas investments.
India gains at the expense of Russia and Brazil
Over half, or 269 NSE 500 stocks, have given over 10-fold (10x) returns in the last two decades, finds a recent report by Goldman Sachs that analysed 10 major markets across emerging and developed markets (EM/DM) that covered 6,700 stocks. The report examined '10-baggers' - stocks that have generated at least 10x total returns within a rolling 5-year period over the past two decades. Some of the prominent ones that comprise these 269 stocks in the Indian context stocks that delivered over 10x total returns over a 5-year rolling period since 2000 as per Goldman Sachs includes Westlife Foodworld, Bharti Airtel, Adani Total Gas, Patanjali Foods, Larsen & Toubro, BEML, Blue Star, Shree Cement, Lupin, Godrej Industries, Astral, Adani Enterprises, Hindustan Petroleum and Deepak Fertilisers.
Rising crude oil prices, traction in China equities and inflation concerns back home are casting a shadow on the Indian equity markets in the short term, believe analysts at Jefferies. They said this could see the markets remaining range-bound in the near term before the next leg up.
The broadening of the market rally sends the signal that growth will be broad-based, observes Akash Prakash.
Most sought-after market of the past few years doesn't feature among top bets in Asia, emerging markets
Once a shining jewel, India 's sparkle has dimmed in recent months.
Morgan Stanley on Thursday became the latest brokerage to question the valuations of Indian equities and downgraded them from 'overweight' (OW) to 'equalweight' (EW) and recommended taking some money off the table. "We move tactically EW on India equities after strong relative gains - we expect a structural multi-year earnings recovery, but at 24 times forward price-to-earnings (P/E) we look for some consolidation ahead of US Fed tapering, an RBI hike in February and higher energy costs," Morgan Stanley equity strategists, led by Daniel Blake and Jonathan Garner, said in a note on Asia Pacific markets. The brokerage has upgraded Indonesia to OW, while maintaining an EW stance on China and UW on Taiwan.
Markets ended in red, index heavyweights drag.
Mutual funds (MFs) are lining up distinguished new fund offerings (NFOs) for the next financial year to win over investors after a lukewarm response to product launches in the 2022-23 financial year (FY23). NFOs drew a lukewarm response in FY23 as launches were mostly in the passive debt space, which has a comparatively lower popularity among retail investors. The limited launches in equity space also failed to rake in huge sums due to subdued investor sentiments in a volatile market.
Foreign portfolio investors (FPIs) turned net buyers in October after being net sellers in the previous month. In October, FPIs bought shares worth nearly Rs 8,430 crore ($1 billion) against net selling of Rs 13,405 crore ($1.6 billion) in September. Positive flows during three of the previous four months have pushed the domestic markets towards fresh all-time highs. At present, the Sensex and Nifty are less than 2 per cent shy of breaching record highs logged in October 2021. A rally in equity markets in the US and Europe is in hopes that the Federal Reserve may go soft on rate hikes after its November meeting.
'Yet the market didn't do all that badly because it was cushioned by domestic inflows.'
Singapore Exchange plans to launch more India-based products to provide opportunities for global investors interested in tapping the Indian market.
Markets and blue chip stocks may see a downward correction in short-to-medium term.
Markets end in red; bluechips struggle to keep pace.
In absolute terms, the year closed with the market capitalisation of all BSE-listed companies rising by Rs 45.5 lakh crore to Rs 152 lakh crore, or an increase of 42.8 per cent, compared to the closing value on December 30, 2016, says Pavan Burugula.
The proposal to increase public float, hike income tax surcharge, move to tax share buybacks and lack of stimulus to shore up economic growth has hurt investor sentiment.
So far this month, another $4.5 billion (Rs 33,000 crore) has flown into domestic stocks.
Ends the August F&O series on a high tracking gains in RIL, HDFC and ITC.
Thus far in FY21, BSE, NSE have rallied 70 per cent and 71 per cent, respectively.
Does the rally reflect expectations of improving fundamentals or they are likely to correct?
Morgan Stanley has upgraded China's equities amidst optimism about the country relaxing restrictions to slow down the spread of Covid-19. "Multiple positive developments alongside a clear path set towards reopening warrant an upgrade and index target increases for China," the brokerage said in a note. MSCI China's return on equity (ROE) is likely to rise from 9.4 per cent to 11.1 per cent by the end-2023.
The second half of June could be driven more or less by technical factors triggered by news flow from Greece, the US Federal Reserve and the monsoon. The technical picture seems bearish as of now, says Devangshu Datta.
The broader markets were also in top gear, with the BSE midcap index surging by 2.1% at 11,431 and the smallcap index gaining 1.4% at 11,735.
The finance ministry said the sharp inflows last fiscal were due to the government's policy initiatives and economic recovery.
'Recent underperformance notwithstanding, equities should constitute a major part of investors' financial portfolio.'
BSE IT index was the biggest sectoral loser, down 1.5% dragged by TCS
Except for September quarter, which had net inflows of $196 million, all other quarters had outflows.
Expectations of continued stimulus withdrawal by the US Federal Reserve added to the market's gloom.
'If the Union Budget can provide incentives for animal spirits to come as well as induce demand stimulus and consumption, the Budget would have done a wonderful job.'
Extending gains for the third day, gold prices rose by Rs 300 to Rs 30,700 per ten gram in the national capital today on sustained buying by stockists for the ongoing marriage season amid a firming global trend.
This flight of capital began in early August due to risk-aversion created first by rising geopolitical tensions due to North Korean aggression and second by the US Fed's decision to shrink its balance sheet
Markets were left high and dry last week, as the 'Monsoon Effect' played havoc on trader sentiment.
The market breadth, indicating the overall health of the market turned negative from positive
Since October, FPIs have sold over $26 billion worth of stocks, which is the largest selling ever seen in India, observes Akash Prakash.
From the 30-share pack, 24 companies fell, with Yes Bank emerging as the top loser, dropping 8.36 per cent, followed by NTPC, M&M and Vedanta.
Indian stocks have emerged as the best performers among those in the emerging and the developed markets across the globe so far this year, giving investors the highest return of nearly 60 per cent.
The broader markets, however, outperformed the benchmark indices -- BSE Midcap and Smallcap indices ended up 0.6%-1%.
