There is a huge shift in asset under management of the domestic mutual fund industry over the past year as investors pumped in money into equity schemes. And now equity is no longer under-owned in mutual fund holdings unlike earlier where the bulk of funds were in debt oriented schemes. Now equity now constitutes 60 per cent of total mutual fund holding.
The stock market swung widely between negative and positive terrains before ending the day’s trade with a gain of nearly 200 points, possibly sensing a clear victory for BJP in Gujarat.
The benchmark index BSE Sensex opened in the green, jumping 117 points. Wider benchmark NSE Nifty went above 10,200-mark. Analysts attributed the early gains to optimistic buying ahead of exit poll. All sectoral indices, including realty, consumer durables, oil and gas and metal stocks, traded positive.
With huge inflows from retail and high networth individuals into equity funds, domestic asset mangers are emerging as a dominant force in the market and acting as a strong counterforce to the vagaries of overseas funds.
The spread between the 10-year benchmark US government bond yield and its comparable Indian bond widened to its highest level in eight months, supported by the softer stance of the US Federal Open Market Committee (FOMC) and speculation among local investors of a likely RBI rate hike in mid-2018.
It seems 2018 is going to be a different year for the equity market that delivered around 25 per cent return in 2017. Top foreign banks and asset managers predict significant uncertainty around growth and higher volatility next year from state and general elections
This year, the market had a one-way bull run from the very start, with the Sensex starting around the 26,500 range and reaching 33,246, as of today, with minor volatility in between.
India’s trade deficit is expected to narrow in November as services exports accelerated on pick up in global growth amid fading disruptions caused by implementation of the goods and services tax (GST), experts say. Adding to this, momentum in imports is expected to moderate partially driven by a higher base of comparison.
“Improved global demand conditions and fading off GST-related impact on the export business is likely to narrow the trade deficit,” said a senior economist with a private-sector bank.
The best stock market performance in 2017 has come from small-cap and mid-cap stocks and the rally in these scrips is likely to continue in 2018.
The top 25 small-cap stocks from the BSE small-cap index list have given year-to-date (YTD) return in the range of 225 per cent to 1,100 per cent in 2017, according to a study of Capitaline data. The significance of such high returns is only compounded when compared to 25 per cent return recorded by benchmark indices BSE Sensex and NSE Nifty 50 during the same period.
Fund raising through new offerings has hit an all-time high of Rs 70,000 crore so far this year. The staggering amount was mobilised through 122 initial public offers (IPOs), making it one of the best years for the primary market. This has also helped the market cap to GDP ratio touch a seven-year high of 85 per cent.
Companies from 18 different industries raise
Banks will initiate insolvency proceedings against 23 large stressed accounts identified by the Reserve Bank of India (RBI) in its second list as the resolution deadline for 28 accounts ended on Wednesday.
Bharti Airtel, India's largest listed telecom service provider on Tuesday, announced that Warburg Pincus, a global private equity firm, plans to acquire up to 20 per cent equity stake in Bharti Telemedia Ltd, the DTH arm of Airtel, for around $350 million.