OVERVIEW OF MARKET
Nifty was flat during the month on the back of easing of trade tensions, benign CPI inflation and in line Q3 corporate earnings. The Union Budget 2019-20 struck a balance of addressing Farm distress, Consumption & Fiscal Prudence. Among the sectors, IT, Energy and Banks outperformed while Auto, Metals and Infra underperformed the Nifty during the month. FIIs were net sellers to the tune of about Rs 33bn, while domestic mutual funds bought around Rs 75bn of equity during the month.
The Index of Industrial Production growth moderated to 0.5% in November compared to 8.4% in October. CPI inflation was stable at 2.2% in December against 2.3% in November. WPI inflation came in at 3.8% in December as against 4.6% in November.
The Bond yields rose during the month of January 2019. The old 10 year benchmark G-Sec (7.17% GOI 2028) closed 11bp higher at 7.48% against 7.37% last month.