8 DALAL STREET INVESTMENT JOURNAL I JULY 22 - AUG 4, 2019 DSIJ. in^
C
learly, the government
addressed many burning
issues in the Union budget
2019, yet the markets reacted
negatively as most of these
measures proposed by the Prime Minister
Narendra Modi-led NDA government
will be beneficial in the long-run. Markets
did not get any quick fix triggers from the
budget and slid more than 2 per cent in
the past two weeks. Finance Minister
Nirmala Sitharaman has given a growth-
oriented budget bearing in mind that the
government has a full term of five years to
serve the nation and doling out freebies
was never the focus of the Modi
government.Post the budget announcement, the
benchmark index Sensex slipped down
by 2.39 per cent, while Nifty dipped by
2.64 per cent during the fortnight. The
downtrend was broad-based with almost
all stocks experiencing selling pressure.
The BSE Midcap index was down by 2.
per cent and Smallcap index lost more
ground and dipped by 3.54 per cent
during the fortnight.As the government drew the roadmap for
making India a US$ 5 trillion economy by
2024, the budget earmarked an
investment of Rs. 100 lakh crore for
infrastructure. The budget provided relief
to the realty sector by increasing the cap
of interest deductions on loans for
affordable housing, while also helping the
cash-strapped NBFCs with liquidity by
provisioning Rs 1 lakh crore
securitisation facility with a government
guarantee. Despite this, in the absence of
any immediate triggers, all major sectoral
indices headed southwards, with BSE
Metal index losing the most, followed by
BSE Auto, Power and Realty indices.
During the fortnight, the BSE Metal
index lost 5.04 per cent, while the BSE
Auto, Power and Realty indices lost more
than 4 per cent each. The BSE IT index
was down by 3.53 per cent; Bankex wasdown by 2.27 per cent and FMCG was
down by 1.27 per cent.The international markets were mixed
during the fortnight with major US
indices showing an uptrend, while the
European and Asian indices experienced
some downward pressures. Dow Jones
was up by 2.30 per cent; S&P 500 was up
by 1.67 per cent and Nasdaq was up by
1.89 per cent, during the fortnight. The
UK’s FTSE 100 was up by 0.11 per cent,
while the German DAX was down by
1.59 per cent and the French CAC 40
gained marginally by 0.09 per cent.
Among the Asian indices, the Shanghai
Composite lost the most, down by 3.
per cent, followed by the Hang Seng,
down by 0.25 per cent, while the
Japanese Nikkei dipped 0.20 per cent,
during the fortnight.Institutional investors were active
post-budget, with nearly equal
participation by both foreign
institutional investors (FIIs) and
domestic institutional investors (DIIs).
The trading data for the fortnight shows
that FIIs were net sellers to the tune of
Rs. 4,953.77 crore, while DIIs mitigated
the outflow by being net buyers to the
tune of Rs. 4,071.19 crore, during the
fortnight.Modi Sarkar 2’s first budget is a fiscal
Performance Of IndicesSensex 39,686.50 38,736.23 -2.
Nifty 11,865.60 11,552.50 -2.
Mid-Cap 14,888.98 14,553.88 -2.
Small-Cap 14,282.61 13,776.58 -3.
Auto 18,124.53 17,271.58 -4.
Bankex 35,214.72 34,415.02 -2.
FMCG 11,364.48 11,219.95 -1.
IT 15,654.76 15,102.18 -3.
Metal 11,099.19 10,540.26 -5.
Power 2,116.81 2,019.72 -4.
Realty 2,258.46 2163.68 -4.12 th July
2019Gain/Loss
(%)01 st July
Indices 2019Net Investment In Equity Markets (`/Cr)01-Jul-19 -568.84 -50.
02-Jul-19 -863.03 141.
03-Jul-19 -1553.11 287.
04-Jul-19 -1281.19 58.
05-Jul-19 555.96 275.
08-Jul-19 599.59 321.
09-Jul-19 -329.85 710.
10-Jul-19 -876.83 667.
11-Jul-19 -459.66 719.
12-Jul-19 -176.81 940.
Total -4953.77 4071.Date FIIs DIIsDow Jones Ind 26,717.43 27,332.03 2.
S&P 500 2,964.33 3013.77 1.
NASDAQ 8,091.16 8,244.14 1.
FTSE 100 7,497.50 7,505.97 0.
DAX 12,521.88 12,323.32 -1.
CAC 40 5,567.91 5,572.86 0.
Hang Seng 28542.62* 28,471.62 -0.
Nikkei 21,729.97 21,685.90 -0.
Shanghai 3,044.90 2,930.55 -3.Indices^01st July
201912 th July
2019Gain/Loss
(%)stimulus programme designed to
reviving investment and growth of the
economy while trying to improve exports
and protect domestic enterprises. On the
other hand, the increase in minimum
public shareholding requirement from 25
per cent to 35 per cent is expected to keep
the markets from scaling new high in the
short-term. However, the fundamentals
are likely to come back into focus and
corporate earnings growth is expected to
give direction to the markets, going
forward.Market Watch
DSMarket Back To Chasing
Earnings Growth
As the government drew the
roadmap for making India a
US$ 5 trillion economy by
2024, the budget earmarked
an investment of Rs. 100 lakh
crore for infrastructure. The
budget provided relief to the
realty sector by increasing the
cap of interest deductions on
loans for affordable housing,
while also helping the cash-
strapped NBFCs with liquidity*data as on 28/06/2019 as exchange was closed on 01/07/2019.