Sensex and Nifty logged in smart gains in financial year 2018-19.The SP BSE Sensex and NSE Nifty 50 indexes logged in smart gains in financial year 2018-19, which concluded on Friday.
The Sensex jumped 5,704 points or 17 per cent and the NSE Nifty 50 Index added 1,510 points to clock a return of 15 per cent in FY18-19.
However, the year-long journey for the domestic benchmark equity indexes was marred with volatility.
The benchmarks rose to record highs in August but corrected sharply starting September through January on the back of tight liquidity conditions domestically in the aftermath of liquidity-related concerns triggered by the defaults by Investment Leasing and Financial Services (ILFS).With the gush of liquidity from foreign investors after global central banks turned dovish pushed the indexes - Sensex and Nifty - to six-month highs.Till Thursday's close, foreign institutional investors (FIIs) net purchased shares worth Rs 30,459 crore this month, according to data compiled by NSDL.
That marked a significant increase from Rs 17,220 crore in the previous month.Analysts say emergence of liquidity back into the emerging markets helped the Indian markets regain some ground."Indian markets played a catch up with the global peers after 4-5 months of underperformance as global liquidity found its way to emerging markets and India was a beneficiary of that after global central banks turned accommodative and dovish," Ajay Bagga, executive chairman at OPC Asset Solutions, told TheIndianSubcontinent.Domestically, investor confidence got a boost on brightening prospects of Prime Minister Narendra Modi and his ruling Bharatiya Janata Party returning to power."The present political formation with allies or even with a few more allies if numbers are lower will be able to form a stable government and after Balakot strike market seems to have factored that in," Mr Bagga said."Today we are sitting in a stage where investors are saying global flows are returning to India, there is continuity on political front so it is a good time to invest."Seven of 11 sector gauges compiled by National Stock Exchange ended higher led by Nifty Private Bank Index's 26.5 per cent gain.
Nifty Bank, Information Technology, Financial Services, FMCG and PSU Bank indexes also rose between 16 and 20 per cent each.
On the flipside, Auto and Media Indexes dropped over 20 per cent each.Banking shares surged on improving bad loan ratios.
The Indian banking sector's non-performing loan (NPL) ratio for the nine months to December 2018 fell to 10.8 per cent from 11.5 per cent at fiscal year end 2018, news agency IANS reported citing a Fitch Ratings' estimate.Bajaj Finance was top Nifty gainer in the Nifty 50 basket of shares, the stock surged 71 per cent till yesterday's closing price.
Reliance Industries, Axis Bank, ICICI Bank, Tata Consultancy Services, Bajaj Finserv, Dr.
Reddy's Labs, Asian Paints and Infosys also rallied between 31 and 54 per cent each.On the flipside, Tata Motors plunged 47 per cent after it reported largest ever loss of Rs 26,993 crore in December quarter.
Vedanta, Indiabulls Housing Finance, Hero MotoCorp, Eicher Motors, Maruti Suzuki, Zee Entertainment, Grasim Industries and Bharti Airtel also gave negative returns to the tune of 16-34 per cent each.Going ahead Sensex and Nifty are likely to extend gains in new financial year on the back of earnings growth.
"Larger companies are talking about earnings growth of 15-17 per cent (for financial year 2019-20) so obviously size of opportunities is getting bigger," said Deven Choksey, managing director of KRChoksey Investment Managers.Get the latest election news, live updates and election schedule for Lok Sabha Elections 2019 on TheIndianSubcontinent.com/elections.
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