The bulls have been dominating the stock markets for quite some time now. However, last week was a little different, as sellers outpaced the buyers – for the first time in 6 weeks. Lots of developments, especially in the global markets, have led to this. From a domestic sentiment point of view, profit-booking was cited as one of the reasons for markets falling, as investors liquidated their investments that had witnessed healthy gains over the past few weeks.

Global market sentiments also wavered, which caused selling in Indian equities as well. On a global level, firstly, US bond yields were on the rise. This meant that Foreign Institutional Investors (FIIs) sold stocks in developing markets like India as yields in developed markets like the US rose. Moreover, increasing crude oil prices and the Chinese Evergrande crisis acted as key headwinds to the ongoing rally in the global markets. FIIs sold north of ₹6,000 crores within 3 days of the trading week. This led some market experts to question if the big guys knew something that the small guys (retail investors) did not know?

Anyway, before moving on to further updates about the markets, here is a quote of the week for you…

Quote of the week

“Money does not buy you happiness, but lack of money certainly buys you misery.”

Daniel Kahneman

Markets Update

The Big Picture

• India’s infrastructure output, which measures the performance of industries like steel, coal, natural gas, electricity, etc. jumped by 11.6% year-on-year in August 2021 – the biggest gain in 3 months.
• India’s fiscal deficit, which is the difference between government revenues and expenses, stood at ₹4.70 lakh crores in April-August FY 2021-22.
• India’s trade deficit (which is the country’s imports minus its exports) widened to $22.94 billion in September 2021. It was the largest trade gap on record, as imports jumped 86% while exports just rose at a softer 21.3%.
• India’s Manufacturing PMI, which measures the manufacturing sector’s health, rose to 53.7 in September 2021 from 52.3 a month earlier and above market consensus of 51.8, indicating a stronger expansion in overall business conditions across the sector.
• Foreign Exchange Reserves in India stood at $638.60 billion on September 24th from $639.64 billion in the previous week.

In the spotlight

‘Quality Smallcap — Smart Beta’ smallcase by Windmill Capital

The ‘Quality Smallcap – Smart Beta’ smallcase aims to invest in budding and quality smallcap stocks that are experiencing a positive momentum trend in their price.

Quality Smallcap – Smart Beta smallcase by Windmill Capital

Stocks are given a quality score on the basis of their financial strength and are weighted to maximize return potential while controlling the risk assumed in the portfolio. Read more about the smallcase, here.

That’s all for this week. Take care, and happy investing! 🙂