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Business Recorder
4 days ago
- Business
- Business Recorder
India's benchmark Nifty 50 logs best day in three weeks on RBI's bumper policy support
India's benchmark Nifty 50 logged its best day in three weeks as investors rallied behind the central bank's bumper policy measures. The Reserve Bank of India (RBI) cut the key lending rate by 50 basis points, exceeding the widely expected 25 basis point reduction. It also unexpectedly reduced the cash reserve ratio (CRR) requirement for banks by 100 bps and shifted its policy stance to neutral from accommodative. The Nifty 50 and the BSE Sensex added about 1% on the day and for the week to close at 25,003.05 and 82,188.99, respectively. The benchmarks also recorded their first weekly gain after two straight weeks of decline. 'This is not business-as-usual monetary policy. It is a deliberate realignment based on a rare convergence of falling inflation, stable external accounts, and the need to pre-empt global slowdown spillovers,' said Arsh Mogre, economist at PL Capital. The CRR cut is expected to boost banking liquidity by 2.5 trillion rupees, on top of the existing surplus of 3 trillion rupees, Barclays said. This liquidity boost is expected to lower the cost of funding for banks and spur credit growth, powering rate-sensitive stocks. All 13 sub-sectors climbed. Financials jumped 1.8% on the day to hit record highs, with heavyweight HDFC Bank touching a lifetime high level after an 1.5% surge. Non-bank lender Bajaj Finance gained 4.9%. Reliance, rate-sensitive sectors lead Indian shares higher, RBI decision in focus Real estate stocks soared 4.7% and automobile stocks added 1.5%. The smallcaps and midcaps gained 0.8% and 1.2%, respectively. 'Excess liquidity tends to find its way into capital markets, especially in an environment of declining savings and deposit rates,' said Apurva Sheth, head of market perspectives and research at SAMCO Securities. Bucking the trend, some railway stocks, including RailTel Corporation of India and RITES, slipped on the day after Kotak Institutional Equities said the recent surge in stocks contrasted their fundamentals.
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Business Standard
20-05-2025
- Business
- Business Standard
A bull-market illusion? Handful of stocks driving the surge, data reveals
The ongoing rally in benchmark indices has not lifted all boats, as only a handful of stocks have recovered to their levels at last year's market peak. While the Nifty 50 index is currently less than 5 per cent below its high and has recovered 14 per cent from its recent low of 21,750 levels, 41 stocks (82 per cent), are still below their closing prices when the index hit its peak on September 27, data shows. In the broader markets, too, over 72 per cent of the NSE 500 stocks are still trading below their closing prices from September 27. Additionally, one in four stocks, or 28 per cent, remain lower by more than 20 per cent from those closing levels, according to data compiled by Business Standard. Among the top 750 listed companies, analysts at SAMCO Securities said, stocks of only 30-35 companies have driven the recent rally, highlighting that the reality is this "isn't a bull market - it's more like a bull mirage." The index may flirt with 25,000, but most stocks are still nursing their wounds, it said in a recent note. "This isn't a rotation - it's a massacre disguised as a milestone," wrote Apurva Sheth, Head of Market Perspectives & Research, SAMCO Securities, in a recent note. Within the NSE 500 pack, Sterling and Wilson Renewable (down 54 per cent), Adani Green Energy (down 51 per cent), Ola Electric Mobility (down 49 per cent), BrainBees Solutions (down 46 per cent) and IndusInd Bank (down 46 per cent) are the top losers since the market closing on September 26. They are yet to hit their peak levels hit late last year. Transformers & Rectifiers (up 67 per cent), BSE (98 per cent), and JSW Holdings (156 per cent) are top gainers along with defence public sector undertakings (PSUs) like Mazagon Dock Shipbuilders (61 per cent), Garden Reach Shipbuilders (45 per cent) and Bharat Dynamics (62 per cent). Momentum still prevails However, market experts are of the view that, while the rally may be led by few heavyweights, the bullish momentum still prevails from a long-term viewpoint. Indian equity market is showing clear signs of bullish momentum, according to Chandan Taparia, head of derivatives and technicals, wealth management at Motilal Oswal Financial Services (MOFSL). He points to a sharp recovery of over 3,000 points from recent lows in the Nifty index, which is trading above its 50-day exponential moving average (EMA). This is a key technical signal that the market is gaining strength, Taparia said, adding, 'This kind of recovery doesn't happen in a bear market.' Taparia noted that the current rally has been led by selective sectors, particularly banking and heavyweight counters like Reliance Industries (RIL). The Bank Nifty has surged to record highs, contributing significantly to the market's gains, he added. He also highlighted the sustained Systematic Investment Plan (SIPs) inflows and aggressive buying by both Foreign Institutional Investors (FIIs) and Domestic Institutional Investors (DIIs). 'The FIIs' long-short ratio has turned positive and SIP flows are at record highs, which underpins the bullish sentiment,' he said. While the market has been range-bound between 22,000 and 26,000 for several months, Taparia believes sector rotation, from defence and banking to metals and IT, will broaden the rally. We're in a phase where selective buying is driving the index, and broader participation will follow, he said.
Time of India
16-05-2025
- Business
- Time of India
Nifty at 7-month high but here's why your stock portfolio is still sulking
Nifty 50 hit a 7-month high, but the rally is narrow and large-cap driven, leaving most portfolios lagging. Over 75% of stocks remain in the red despite recent gains in mid- and small-cap segments, says SAMCO Securities. Tired of too many ads? Remove Ads Tired of too many ads? Remove Ads India's benchmark Nifty 50 index has surged past the 25,000 mark, touching a fresh seven-month high this week. But while the index may be celebrating, chances are your portfolio isn't — and there's a clear reason Nifty 50 climbed 4.21% for the week to close at 25,019.80 on Friday, driven by optimism over easing geopolitical tensions with Pakistan, progress in trade negotiations with the United States, and hopes of a domestic rate cut. The Sensex also posted a weekly gain of 3.62%, ending at 82,330.59. But beneath the surface of these headline highs lies a sharply divided market, reflecting how the rally was not a broad-based one."The Nifty 50 has reclaimed the 25,000 mark after a long, 7-month slog. But before you pop the champagne, take a closer look: the index may be shining, but your portfolio might still be sulking in a corner," said Apurva Sheth, Head of Market Perspectives & Research at SAMCO October 15, 2024, the benchmark index has returned just 0.02%, while broader market segments have lagged significantly. The Nifty Midcap 150 has dropped 6.09%, the Nifty Smallcap 250 is down 12.50%, and the Nifty Microcap 250 has slipped 12.22%."This isn't a broad-based bull run. It's a narrow rally led by a handful of large caps while the rest of the market has been quietly bleeding," Sheth the index appears buoyant, the broader market tells a different story. A detailed analysis by SAMCO Securities of 730 companies—excluding 20 recent IPOs—shows that nearly 75% of stocks are still in the red. Only a small fraction of the market has delivered positive returns, with the majority of listed names still underwater.'If you're stuck in one of the 170 stocks that are down 25% to 50%, this 'rally' feels more like a recession,' Sheth said. He warned that the supposed market strength is largely illusory, driven by select large-caps that mask the broader pain being felt across week, mid-cap and small-cap stocks did see a rebound, with the Nifty Midcap and Smallcap indices gaining 7.2% and 9.2% respectively. The uptick was led by defence stocks and strong post-earnings moves in key names. However, the bounce does little to offset the persistent drag over the past seven months.'This isn't a bull market—it's a bull illusion. If you're not in the handful of heavyweight stocks pulling the index up, you're likely still in pain,' Sheth said. For most investors, the milestone of Nifty at 25,000 offers little solace. As he puts it, 'The next time someone says, 'Nifty's at 25k!' — just ask: 'Yes, but is your portfolio?''Also read | Market Wrap: Financials, IT stocks drag D-Street lower; Sensex sheds 200 pts, Nifty below 25,100 (Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of The Economic Times)
Economic Times
16-05-2025
- Business
- Economic Times
Nifty at 7-month high but here's why your stock portfolio is still sulking
Nifty 50 hit a 7-month high, but the rally is narrow and large-cap driven, leaving most portfolios lagging. Over 75% of stocks remain in the red despite recent gains in mid- and small-cap segments, says SAMCO Securities. Tired of too many ads? Remove Ads Tired of too many ads? Remove Ads India's benchmark Nifty 50 index has surged past the 25,000 mark, touching a fresh seven-month high this week. But while the index may be celebrating, chances are your portfolio isn't — and there's a clear reason Nifty 50 climbed 4.21% for the week to close at 25,019.80 on Friday, driven by optimism over easing geopolitical tensions with Pakistan, progress in trade negotiations with the United States, and hopes of a domestic rate cut. The Sensex also posted a weekly gain of 3.62%, ending at 82,330.59. But beneath the surface of these headline highs lies a sharply divided market, reflecting how the rally was not a broad-based one."The Nifty 50 has reclaimed the 25,000 mark after a long, 7-month slog. But before you pop the champagne, take a closer look: the index may be shining, but your portfolio might still be sulking in a corner," said Apurva Sheth, Head of Market Perspectives & Research at SAMCO October 15, 2024, the benchmark index has returned just 0.02%, while broader market segments have lagged significantly. The Nifty Midcap 150 has dropped 6.09%, the Nifty Smallcap 250 is down 12.50%, and the Nifty Microcap 250 has slipped 12.22%."This isn't a broad-based bull run. It's a narrow rally led by a handful of large caps while the rest of the market has been quietly bleeding," Sheth the index appears buoyant, the broader market tells a different story. A detailed analysis by SAMCO Securities of 730 companies—excluding 20 recent IPOs—shows that nearly 75% of stocks are still in the red. Only a small fraction of the market has delivered positive returns, with the majority of listed names still underwater.'If you're stuck in one of the 170 stocks that are down 25% to 50%, this 'rally' feels more like a recession,' Sheth said. He warned that the supposed market strength is largely illusory, driven by select large-caps that mask the broader pain being felt across week, mid-cap and small-cap stocks did see a rebound, with the Nifty Midcap and Smallcap indices gaining 7.2% and 9.2% respectively. The uptick was led by defence stocks and strong post-earnings moves in key names. However, the bounce does little to offset the persistent drag over the past seven months.'This isn't a bull market—it's a bull illusion. If you're not in the handful of heavyweight stocks pulling the index up, you're likely still in pain,' Sheth said. For most investors, the milestone of Nifty at 25,000 offers little solace. As he puts it, 'The next time someone says, 'Nifty's at 25k!' — just ask: 'Yes, but is your portfolio?''Also read | Market Wrap: Financials, IT stocks drag D-Street lower; Sensex sheds 200 pts, Nifty below 25,100 (Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of The Economic Times)
Mint
15-05-2025
- Business
- Mint
After a glittery rally, gold may be about to make way for stocks
'However, gold prices still have room for improvement with eventual (US) rate cuts on the horizon and continuous central bank buying. Till then, gold can find a key support at the $3080 per ounce level," she said. But gold's geopolitical risk premium is beginning to fade as the ongoing US-China trade negotiations have shown significant progress, noted Apurva Sheth, head of market perspectives and research at Samco Securities. Also read: Early birds report of a steady yet muted Q4 Last week, the US agreed to cut duties on Chinese exports to 30% from 145% for 90 days, while China reduced its tariffs on US goods to 10% from 125% for the same period, signalling an intent to de-escalate and move towards a structured trade agreement. 'This has reduced the need for investors to seek shelter in traditional safe-haven assets like gold," Seth added. In fact, during the latest Mint quarterly market survey, Jay Kothari, lead equity strategist at DSP Mutual Fund, noted that the best way to play gold from hereon is through gold-related equities. Uncertainty's gold Uncertainty defined FY25, marked by shifting policies and global tensions. Gold capitalized on this instability, outshining other asset classes. To be sure, gold returned around 27% in 2024, outperforming every other asset class and marking its ninth consecutive annual gain last year. A couple of ongoing wars, relentless central bank buying – for diversifying reserves and reducing reliance on the US dollar – and a weakening global outlook drew investors to gold, as they faced a spate of uncertainties in the near term. US president Donald Trump's tariff tantrums and the recent rout in the US currency and treasury market further increased the appeal for gold as the only reliable safe haven asset, further fuelling its rally in 2025. Indian investors appear to taking a U-turn from safe haven gold to riskier assets like equities, as green shoots of geopolitical stability begin to emerge across the globe. With the precious metal already delivering returns as high as 25% in the first four months of 2025, experts believe there is limited room for significant upside, especially as global uncertainties begin to wane. This likely explains why domestic gold exchange traded fund (ETF) redemptions reached a one-year high last month. Also read: Banks' Q4 earnings hit an 8-quarter high. But that's not driven by loans Moreover, gold has remained under pressure lately, with prices being very volatile in the last three to four weeks. Going forward, Kaynat Chainwala, associate vice-president of commodity research at Kotak Securities, anticipates a 7-8% correction in gold prices in the short term, driven by easing US-China trade tensions. In India, gold prices touched an all-time high of ₹100,000 per 10g in the retail market last month. The surge in demand for the yellow metal reached a 15-year high in 2024, fuelling its meteoric price rise. Gold demand in the country reached 4,974 tonnes in 2024, mainly driven by jewellery and investment demand, which accounted for 40% and 24% of total gold demand respectively, according to the latest NSE Market Pulse report. Also read: What the market crystal ball sees for the next 3 months While total demand rose 0.6% on a year-on-year basis, albeit on a high base, demand for gold investment rose the highest at almost 25% during the same period. Equities turn? But how long will this heightened investment demand for gold endure? A recent Motilal Oswal Financial Services report highlighted that with domestic equities underperforming, the gold price to Nifty-50 index ratio has already breached its historical median and is now nearing its FY16 peak of 4.2x. Historically, such levels have suggested a higher probability of equities outperforming gold in the future. Could a sustained recovery in equities alter this dynamic? In fact, even though gold has outperformed domestic equities in a one to three-year timeframe, from a very long-term perspective, equites have historically delivered superior returns. Hence, experts are advising caution in investing in gold going forward. 'Investors should invest in a staggered manner as and when gold (prices) falls from here on, instead of going all in. While existing uncertainty around US's trade deals will support gold prices for the next few months, we are expecting a consolidation phase in the near term," said Pranav Mer, vice-president of the equity broking group's commodity and currency research team at JM Financial Services. MCX Gold is likely to consolidate in a range of ₹91,542 to ₹93,034, which is at a 50-62% retracement level of the recent rally from ₹86,710 to ₹99,358, noted Seth from Samco Securities. On booking profits, Mer from JM Financial Services suggested that investors should book profits whenever gold rallies from current levels. In fact, investors began redeeming in March, with gold ETFs seeing their first net outflows in over a year that month. In April, however, redemptions reached a one-year peak at ₹ 1,669 crore.
