The domestic benchmark equity market indices – Sensex and Nifty – ended the month of November 2015 in the negative territory, correcting by 1.9% and 1.6%, respectively.
A higher possibility of the Federal Reserve increasing interest rates in December 2015, as perceived by the market, dampened market sentiments.
In November 2015, among sectoral indices, the top two gainers were the BSE Consumer Durables Index and the BSE Auto Index, which rose by 5.0% and 4.4%, respectively. Among the top losers were the BSE Healthcare Index and the BSE Realty Index, which fell by 9.8% and 2.0%, respectively. Foreign Institutional Investors (FIIs) were net seller in Indian equities to the tune of ~Rs. 7,074cr and Domestic Institutional Investors (DIIs) were net buyers in Indian equities to the tune of ~ Rs. 6,548cr, for the month of November 2015.
During the month, the BSE Midcap index has outperformed the broader market indices. We believe mid-cap companies having strong fundamentals have the potential to outperform the broader market, going forward as well. We are replacing Inox Wind with Blue Star in our top picks recommendation.
We expect some volatility in the market, ahead of the upcoming review of interest rates in the US. However, any positive outcome in terms of passing of the Goods and Services Tax (GST) bill in the winter session of the parliament would be a positive for the market. Further, declining interest rates, lower current account deficit and expectation of a stable currency would create positive sentiment for market.