Market Wrap – April 2017

Sensex, Nifty surgesto record high; Sensex surpasses 30,000 mark.

Indian equities logged in significant gains in the month of April with the benchmarks S&P BSE Sensex and Nifty 50 roaring to new highs.

The S&P BSE Sensex hit a fresh record high of 30,184 on April 27, 2017 in intra-day trade, surpassing its previous record high of 30,024 hit on March 04, 2015. The Nifty 50 index climbed past 9,300 for the first time ever.

As per data released by the Securities and Exchange Board of India (SEBI), mutual fund managers invested around Rs 5,000 crore in stock markets in April 2017.

The outperformance of the midcap and small cap segment over the benchmark indices could have added to the gains. BSE Midcap and Smallcap indices gained between 5-6% as against 1.5% rise in the benchmark indices.

The market rally could be a result of a string of relatively good domestic quarterly results, while hopes for additional foreign inflows to India have increased on renewed optimism about the US economy. The first round of elections in France in favour of the market's preferred candidate could also have contributed to the rally.

US military action in Syria added some negative sentiments in global financial markets which could have dragged the domestic sentiment and influenced investors towards profit booking. However, during latter part of the month, markets could have regained strength due to optimistic quarterly earnings and positive global cues.

In the currency front, rupee strengthened past the 64 mark against the US dollar for the first time since in over a year, tracking the gains in the global equity markets.

Buzzing Sectors

Banking stocks witnessed a sturdy momentum on expectation of new NPA (Non-Performing Assets) resolution framework and PCA (Prompt Corrective Action) guidelines. Additionally, an upmove could be witnessed in select stocks in power, consumer durables, aviation and FMCG sectors on expectation of earnings revival.

Government’s push in the infra and affordable housing space could be the reason that the housing, cement and realty stocks witnessed buying demand.

Road Ahead

Macroeconomic data, trend in global markets, auto sales data, Q4 numbers, investment by Foreign Portfolio Investors (FPIs) and Domestic Institutional Investors (DIIs), the movement of rupee against the dollar and crude oil price movement could dictate trend on the bourses in the month of May 2017.

Source: BSE, NSE, SEBI

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