OVERVIEW OF MARKET
Nifty fell ~6% during the month due to concerns of higher crude prices, weakening currency and rising trade deficit. Crude price rose sharply by ~7% and closed at $82.7 due to looming sanctions on Iran. Global trade protectionism scenario escalated as US imposed further tariffs on $267 billion worth of Chinese goods. On the domestic front, liquidity concerns in the debt market were led by default in repayment of loans by the reputed NBFC. Further, the government announced the merger of Bank of Baroda, Vijaya Bank and Dena Bank. Among the sectors, IT, Energy and Pharma outperformed while Auto, Banks and Infra underperformed the Nifty during the month. FIIs were net sellers to the tune of about Rs 96bn, while domestic mutual funds bought around Rs 80bn of equity during the month.
The Index of Industrial Production stood at 6.6% in July compared to 6.9% in June. CPI inflation eased to 3.7% in August against 4.2% in July. WPI inflation cooled to 4.5% in August as against 5.1% in July.
The Bond yields rose during the month of September 2018. The benchmark 10 year G-Sec (7.17% GOI 2028) closed 7bp higher at 8.02% against 7.95% last month.