OVERVIEW OF MARKET
Nifty sharply gained 7% during the month to register a healthy 15% return for the financial year 2019. Contributors to positive market sentiment during the month were pre-election polls indicating the possibility of the incumbent government retaining power, potential rate cut by RBI in its upcoming policy, easing geopolitical tensions between India and Pakistan and optimism over US-China trade negotiations. Among the sectors, Banks, Energy and Infra outperformed while IT, Auto and FMCG underperformed the Nifty during the month. FIIs were net buyers to the tune of about Rs 329bn, while domestic mutual funds sold around Rs 72bn of equity during the month. The Index of Industrial Production growth stood at 1.7% in January compared to 2.4% in December. CPI inflation hardened to 2.6% in February against 2.1% in January. WPI inflation firmed to 2.9% in February as against 2.8% in January.
The Bond market rallied during the month of March 2019. The 10 year benchmark G-Sec (7.26% GOI 2029) closed 6 bps lower at 7.35% against 7.41% last month.