Indian equity markets experienced volatility and posted marginal negative returns in June, owing to weak global cues, foreign funds outflows in the last couple of weeks and the possibility of a weak monsoon that caused investors some concern. The equity markets indices, however, were up during the first two weeks, owing to expectations of strong economic reforms from the new government and foreign inflows. Strong infrastructure output and better industrial production data also boosted the investor sentiments during the month. In June, the Bombay Stock Exchange’s Sensex index declined 0.9%, while the National Stock Exchange’s Nifty index fell 3.5%.
Also See Indian Mutual Funds, Highs and Lows (Graphics)
Foreign institutional investors net invested Rs3,830 crore in Indian equities in June, much lower than Rs20,000 crore in the previous month. Mutual funds invested Rs840 crore in stocks last month, lower than Rs2,300 crore invested in May. Mid-cap stocks outperformed their large- and small-cap counterparts, owing to their favourable valuations. From a sector perspective, the financial sector posted the highest gain of 25%, as measured by the MSCI India Index. The energy sector registered the second highest gain and delivered a 20% return, driven by an increase in crude oil prices. The telecommunications services sector registered the least return during the month.
Graphics by Sandeep Bhatnagar / Mint