The Shape of the Indian Financial Market in the Forthcoming Months

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It will be meaningful to observe how the Indian share markets head from current levels in the coming months. The demand for personal transportation is expected to increase as social distancing becomes a normal part of our lives. Indian share markets BSE Sensex and Nifty 50 are over 30% up from their March loss. However, volatility is likely to persist, this is an observation made by Naveen Kulkarni, chief investment officer, Axis Securities. Despite a positive trend in the last week of May, its sustainability remains questionable. This is because it is more likely to depend on the government’s future actions for the revival of the economy struck by the corona virus-induced lockdown.

A reliable source has explained that the Indian stock market trajectory from the current levels and also explains the triggers that will influence investor attitude. Naveen Kulkarni has explained the Indian stock market’s trajectory well. Has the volatility of Indian stock markets subsided? Somehow or other the volatility will continue. There are so many variables like pent-up demand, labor dislocation, moratorium impact, unemployment, fiscal deficit, and currency fluctuations. As the markets are likely to remain volatile, the movement of many could be adverse.

Pharma and FMCG were the only sectors to deliver positive returns on a three-month basis. These sectors will provide reasonable returns for shareholders as they offer a consistent revenue profile. Also, they will offer prospects of improvement in business in the coming quarters. In April, NIFTY Auto recorded a 0% sales but gained 12% in May, this really is positive. Then comes opening up of the economy and expectations of pent- demand in the sector. In the context of social distancing becoming a norm, demand for personal transportation will increase. Consumption stocks should see improvement in performance. But it will be a diverse assortment of things.

Staples are expected to perform better. The larger ticket items will be under stress. The staples will gain ground with each passing quarter. In April and May, BSE Sensex gained 22%. In most sectors markets will catch up. India has underperformed in the month of May against global benchmarks. At the beginning of June, the Indian markets showed sustainability with the global market. Indian government declared recovery packages as well which sustained our market from a downfall.T

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