HDFC MUTUAL FUNDS Equity Market UPDATED
• After experiencing a fall in March 2021 Equity market, the market witnessed a strong rebound in FY21 by not only covering the lost ground but also scaling all-time highs. • Indian equities had a stellar year with BSC/NIFTY 50 touching all time high approximately 70% higher than last year. • Metal, Auto, IT, & Capital Goods witnessed strong gains while Oil, Gas & FMCG’s underperformed comparatively. • There was a rise in SPI to USD 37 billion in FY21 as against USD 1.3 billion in FY20. • NIFTY 50 returns over past 10-15 years portray approximately 10% – 11% CAGR. • Interesting aspect of equity market is its considerable divergence in valuation across sectors. • Q2 & Q3 in FY21 experienced highest earrings in past 5 years.
HDFC MUTUAL FUNDS Equity Market
• After rising over past few months Equity markets & NIFTY50 ended the month 3% lower as compared to last month. • US & European indices ended the month in Negative while Asian indices delivered positive returns. • Gap between 10 years GSEC & 14 forward NIFTY 50 continues to remain below its 10 years average. • Q3 in FY21 were one of the best earning seasons in last 6 years with PAT growth of 32% • Budget with its focused-on growth & capex received augurs well for a new investment cycle & investment growth. • Overall market hold promises over medium to long term.
HDFC MUTUAL FUNDS Equity Market
• In April 2021 Indian equities traded within range during a month & NIFTY 50 ended flat on month on month basis. • After falling sharply in march 2020 the Indian market registered a gain over 60% during APR-DEC • Market delivered robust return during 2nd & 3rd wave of COVID- 19 in US & UK. • There has been significant rise in Covid cases & stringency of lockdown also increases. However, reaction of equity market has been muted. To find out the reasons behind these things let’s watch the video.
HDFC MUTUAL FUNDS Debt Market
Indian fixed income yields were trending down precovid-19, fell significantly during the year. • Average interbank liquidity was positive during the year supported by liquidity infusion of RBI. This was offset by rise in currency. • Over the year’s RBI had taken steps to cushion the impact of COVID-19 pandemic on growth. • Use of longer tenure VRRR can result in yields thus reducing premia to a certain event. To know more about market situation by March 2021 please watch the video.
HDFC MUTUAL FUNDS Debt Market
Mutual Fund Debt Market update by January 2021 – • In Jan 2021 average net interbank liquidity surplus was largely similar to last month supported by higher government spending’s. • Government relaxed fiscal consolidation timeline these resulted in GSEC yields rising sharply across board since budget announced. • RBI’s decision of leaving policy repo rate & accommodative stance unchanged was in line with market consensus. • Multiple factors have impacted the debt market adversely. To find out more about this please watch the video.
HDFC MUTUAL FUNDS Debt Market
• April 2021 was an eventful month for Indian Debt market. • In the year 2021 despite of multiple negative factors at play the 10 years yield had risen only by 17 basis point. • The 10 years GSEC yield ended the month approximately 14 basis point lower compared to last month.
HDFC Hybrid Equity Fund
What is aggressive hybrid fund? • It’s a mixture of equity & debt. Typically, they have exposure of equity between 65%-80% in portfolio & rest in debt. • Equity & Debt market perform differently in different market cycle & it’s very difficult to predict market cycle. – Why invest in aggressive hybrid funds? – What is funds investment strategy? To find out the answers please watch video.