MOSt
Advisor
Monthly Markets Newsletter
September 2016
In This Issue
•
Market Outlook for the month
• Equity Market Outlook
• Derivatives & Commodities Market Outlook
• Large Cap and Mid Cap Investment Ideas
• Model Advisory Portfolios
• Recommended Funds
• Equity Fund
Key Highlights for the Month
Better 1QFY17 Earnings so far
Normal Monsoon
GST Bill
Dear Investor,
Global Macros:
Month of August was good for equity as
an asset class globally. In challenged global macro-eco-
nomic scenario equity as an asset class will remain the
preferred option for better absolute returns. Major indices
Global Market
Index
31-Aug-16
MoM (%)
YoY(%)
of US equities are trading at all-time highs while most of
European and Emerging market equity indices are within striking distance of all-time
highs. Equity as an asset class has been generating superior absolute returns vis-à-
vis other asset class be it bonds; real state or commodities, propelled by consistent
liquidity push by central bankers across the globe. Europe and Japan two largest
economies of the world have been consistently accelerating the pumping of monetary
stimulus while having negative interest rate regime.
Market Performance:
Market capitalized on all positive triggers be it better 1QFY17
corporate earnings update so far, normal monsoons and passage of GST Bill. SBI's
asset quality was highlight of earnings update which saw sharp deceleration fresh
slippages. Overall, NBFC's, Automobiles, Private Banks (Barring ICICI & AXIS), Cement
and Consumption stocks delivered double digit earnings in high teens and early
twenties. Going into festive season on back drop of better monsoons, fat pay checks
in bank accounts based on 7th Pay commission recommendations and improved
sentiments we expect continuity of equity run up in the month of September as well.
Outlook:
Indian equity offering stand on firm footing when compared to most of
its global counterparts. Several policy measures taken and implemented in past couple
of years; be it coal block allocation, mining auctions, spectrum auction for telecoms,
deregulation of petrol and diesel prices, gas price reform, FDI in Insurance & Defense
sectors, Reduction in Repo rate, 7th Pay Commission Roll out, Passage of GST Bill
etc. will bear fruits now. We expect corporate India to capitalize on better domestic
macro-economic by higher capacity utilization and slow pick up in pricing power
as demand scenario improves on higher disposable income. All this is likely to boost
demand for low cost housing, two wheelers, white goods, electrical & electronic
consumer durables and home refurbishing in particular. We maintain our stance of
a new high in FY17 and advocate sticking to our QGLP philosophy for deploying
money into quality stocks.
Dharmesh Kant
Vice President- Head Of Retail Research
Sensex
Nifty
FTSE
Dow
Nasdaq
Hang Sang
28,452
8,786
6,782
18,401
5,162
22,977
1.4
1.7
0.9
-0.2
-1.0
5.0
8.3
10.2
8.5
11.3
8.1
6.0
Economic Pulse
Key Indicators Current Month
Change (%)
IIP
WPI
10 Year Yield
USD/ INR
Crude ($)
Gold (10 gms)
2.1%
3.55%
7.17%
67.18
47.04
30814
75.00
119.14
0.00
0.28
10.79
-0.40
Thought for the month
1