Monthly market commentary, knowledge series and more from FinKasturi Nivesh. 11 posts in 2025.
The Month That Was : November 2025
· Category: Global Markets
Indian equity markets scaled fresh record highs in November, with the Nifty 50 Index gaining 1.9% during the month. Broader markets were mixed, with mid-cap indices posting similar gains while small-cap stocks underperformed, declining by 3%. Sectoral performance was uneven, with IT, auto, and banking stocks outperforming, while real estate, power, and metal stocks faced selling pressure. Globally, market performance was mixed, with several Southeast Asian markets posting modest gains, while Northeast Asian markets ended the month lower.
Investor sentiment was supported by rising expectations of interest rate cuts by the US Federal Reserve and the RBI, easing crude oil prices, and an improving geopolitical outlook amid signs of a potential resolution to the Russia–Ukraine conflict. Other key developments during the month included the government announcing new export support schemes with an outlay of ₹450 billion, notification of four labour codes, the signing of a US deal to avert a government shutdown, and a sell-off in global AI-related stocks on valuation concerns. Corporate earnings for 2QFY25 concluded with a healthy earnings growth across key sectors.
On the macroeconomic front, inflation moderated sharply, with CPI inflation easing to 0.25% in October from 1.4% in September, driven largely by food price deflation and the impact of GST rate cuts. Real GDP growth for 2QFY26 stood at a strong 8.2%, improving from 7.8% in Q1FY26. On the flows front, FIIs were net sellers to the tune of USD 909 million, while DIIs were strong net buyers of around USD 8.7 billion.
Market Outlook:
Looking ahead, Indian equity markets are likely to remain supported by a favorable domestic macro environment, moderating inflation, and strong GDP growth. Expectations of monetary easing by global and domestic central banks, stable crude oil prices, and sustained domestic institutional buying should continue to provide a cushion to market corrections. While uncertainties around the India-USA trade deal and valuation concerns in select pockets may create intermittent volatility, India’s strong structural growth drivers, government policy support, and resilient corporate earnings outlook position it better relative to other emerging markets.
Happy Investing!
Investments in securities market are subject to market risks. Read all the related documents carefully before investing. This content is for general information and is not investment advice. Past market movements do not indicate future performance. Please consult your financial advisor.
Indian equity markets ended October with strong gains, as the Nifty 50 Index rose by 4.5%. Broader markets outperformed, with mid-cap and small-cap indices gaining 5.8% and 4.7%, respectively. All sectoral indices ended higher with the real estate, IT, oil & gas sectors being the key outperformers, rising 9%, 7%, and 6%, respectively. Globally, markets remained buoyant with South Korea, Japan, and Taiwan posting strong gains of 20%, 17%, and 9%, respectively.
Investor sentiment was supported by robust festive demand, easing global trade tensions, and better than expected 2QFY26 earnings. Other key developments during the month included the RBI Monetary Policy Committe maintaining the repo rate at 5.5% with a neutral stance and the IMF revising India’s FY26 GDP growth forecast upwards to 6.6%. On the macro front, CPI inflation eased sharply to 1.5% in September due to a fall in food prices, even as core inflation edged up to 4.5% led by bullion prices. WPI inflation moderated to 0.13%, while IIP growth slowed slightly to 4%. On the flows front, FPIs were net buyers to the tune of USD 2 billion, while DIIs bought USD 5.9 billion in the secondary market.
Market Outlook:
After a period of underperformance by Indian markets vs global peers on the back of high trade tariffs and muted corporate earnings, the month of October acted as a turning point for Indian markets. With the likelihood of an early closure of the trade deal between India and USA and corporate earnings starting to pick up on the back of strong festive consumption due to GST rate rationalization, Indian markets are looking up, supported by FII flows turning positive in October. Indian markets and domestic focused sectors are likely to remain supported by strong domestic demand, robust FPI and DII flows, and improving corporate earnings momentum. The festive season’s buoyant consumption trends and a stable policy environment have provided confidence for sustained economic growth ahead. With stable macro economic parameters and global trade sentiments improving, India remains one of the most attractive emerging markets in the world.
Happy Investing!
Investments in securities market are subject to market risks. Read all the related documents carefully before investing. This content is for general information and is not investment advice. Past market movements do not indicate future performance. Please consult your financial advisor.
Indian equity markets ended September with modest gains, as the Nifty 50 Index rose by 0.8%. Broader markets outperformed slightly, with mid-cap and small-cap indices gaining 1.4% and 1.9%, respectively. Sectoral performance was mixed – metals, auto, and oil & gas indices rose by 9%, 6%, and 5%, while consumer durables, IT, and FMCG declined by 5%, 3%, and 2%, respectively. Globally, South Korea, Mexico, and Hong Kong were the top gainers with returns of 7–8%.
Investor sentiment was supported by strong economic data, optimism around India-US trade talks, GST rate cuts, and the US Fed’s rate reduction. However, markets witnessed volatility after the US administration imposed a one-time fee on new H-1B visa petitions and announced a 100% tariff on branded drug imports. Key developments during the month were as follows - GST Council rationalizing rates with lower taxes on mass consumption goods and higher taxes on luxury/sin goods, Fitch upgrading India’s GDP growth outlook for FY26 to 6.9%, the US Fed cutting policy rates by 25 bps, and the Indian monsoon ending 8% above normal.
FIIs continued selling with a net outflow of USD 2 bn during the month in secondary markets while DIIs bought USD 7.4 bn.
Market Outlook: Markets are expected to remain volatile in the near term until clarity emerges on trade deal between India and USA. Proactive steps by the Government to boost consumption and a downward trending interest rate cycle should aid in domestic economic growth. Pick up in consumption is already seen with festive season auto sales clocking around 20% growth on the back of GST rate reduction. Also, corporate earnings growth is expected to pick up in H2FY26 supporting the markets. We remain constructive on domestic and consumption oriented sectors such as banking, NBFCs, consumer discretionary, and consumer staples.
Happy Investing!
Investments in securities market are subject to market risks. Read all the related documents carefully before investing. This content is for general information and is not investment advice. Past market movements do not indicate future performance. Please consult your financial advisor.
Indian equity markets ended lower in August, with the Nifty 50 Index declining by 1.4%. Broader markets underperformed as mid-cap and small-cap indices fell by 2.9% and 4.1%, respectively. Sectoral performance was mixed consumption driven sectors gained on optimism around potential GST rationalization, with autos and consumer durables rising by 5.8% and 2%, respectively. In contrast, oil & gas, power, and realty saw declines of 4.7%, 4.6%, and 4.5%, respectively.
Globally, India was one of the most underperforming markets during the month, alongside South Korea and the Philippines. On the other hand, Shanghai, Brazil, and Indonesia emerged as top gainers.
Sentiment remained cautious amid rising trade tensions as the US imposed additional tariffs on Indian goods, citing energy and defense ties with Russia. Other key developments included RBI keeping rates unchanged with a neutral stance, and the US Federal Reserve signaling potential monetary easing in September meeting. S&P Global upgraded India’s sovereign rating from BBB- to BBB with a stable outlook, while the government announced plans to rationalize GST rates to boost consumption.
FIIs sold USD 3.1 billion of equities while DIIs bought USD 9.5 billion during the month. On the economic front, inflation trends remained favorable with CPI easing to 1.6% in July from 2.1% in June and WPI slipping to -0.6%. IIP growth was 3.5% in July vs 1.5% in June, while GDP growth strengthened to 7.8% in 1QFY26 from 7.4% in 4QFY25.
Market Outlook: Markets remain volatile as global trade tensions weigh on investor confidence. While domestic macro indicators such as moderating inflation, resilient IIP, and strong GDP growth provide comfort while persistent foreign outflows and uncertainty around US trade actions pose near term risks. The government has been proactive in its approach towards boosting consumption via reduction in income tax in Union Budget earlier and GST rate cut now. The expected monetary easing by the US Fed, GST rationalization measures, uptick in earnings growth and continued support from domestic institutions could provide fillip to market over medium term. We remain constructive on domestic focussed sectors such as Consumer Discretionary, consumer Staples and automobiles on expected pick up in consumption.
Happy Investing!
Investments in securities market are subject to market risks. Read all the related documents carefully before investing. This content is for general information and is not investment advice. Past market movements do not indicate future performance. Please consult your financial advisor.
Indian equity markets ended their four-month winning streak in July, with the Nifty 50 Index falling by 2.9%. Broader markets underperformed Nifty50 as mid-cap and small-cap indices declined by 4% and 6%, respectively. Sectoral performance was largely negative, with almost all sectors closing in the red. Healthcare and FMCG were the only gainers, rising by 3% and 2%, respectively, while IT, real estate, and capital goods witnessed steep declines of 9%, 7%, and 6%, respectively.
Globally, India was among the worst-performing markets during the month, alongside Brazil, the Philippines, and Malaysia. In contrast, Thailand, Indonesia, and Taiwan emerged as top gainers, posting strong returns of 14%, 8%, and 6%, respectively.
Sentiment remained cautious due to ongoing uncertainty around India-US trade negotiations and muted corporate earnings commentary for the quarter. Although Q1FY26 net income for the Nifty 50 Index have come broadly in line with expectations so far, conservative guidance from company management weighed on investor confidence. FIIs turned net sellers after three months of inflows, offloading USD 3.7 billion worth of Indian equities. DIIs, provided support, buying USD 6.3 billion during the month.
Key macro and policy developments included the signing of a Comprehensive Economic and Trade Agreement (CETA) between India and the UK, and the US maintaining interest rates while announcing a 25% minimum tariff on Indian exports. The IMF raised India’s FY2026 GDP growth projection to 6.4% from 6.2%. On the domestic economic front, June CPI inflation moderated to 2.1% from 2.8% in May, while WPI inflation turned negative at -0.1% year-on-year. IIP growth also decelerated to 1.2% in May from 2.6% in April.
Market Outlook
Markets have witnessed volatility over the last few weeks on the back of the lack of closure of trade deal between India and the USA. Despite the near-term volatility India's macro fundamentals remain intact. The moderation in inflation, steady domestic demand, improving rural economy and supportive interest rate policy environment continue to offer long-term investment opportunities. However, global trade tensions, particularly with the US, and muted corporate earnings guidance could lead to intermittent pressure on markets. Investor focus in the coming months will remain on the monsoon’s impact on rural consumption, developments on the global trade front, and further clarity on earnings outlook. A balanced portfolio strategy favouring defensives like FMCG and utilities, along with selective exposure to domestic cyclicals, may offer a prudent risk-reward opportunity in the current environment.
Happy Investing!
Investments in securities market are subject to market risks. Read all the related documents carefully before investing. This content is for general information and is not investment advice. Past market movements do not indicate future performance. Please consult your financial advisor.
Indian equity markets extended their winning streak for the fourth consecutive month in June, with the Nifty50 Index posting a gain of 3.1%. Broader markets continued to do well, as mid-cap and small-cap indices rose by 4.0% and 6.7%, respectively, on the back of positive global cues. Sectoral performance was broadly positive, with nearly all sectors ending in the green, except FMCG. IT, healthcare and real estate were notable performers. Asian indices such as South Korea and Japan registered strong gains of 13.9% and 6.6%, respectively, while the US S&P 500 rose 4.6%.
Sentiment was uplifted globally by declining crude oil prices and easing of geopolitical tensions, especially following a ceasefire agreement between Iran and Israel. Back home, RBI Monetary Policy Committee (MPC) surprised markets by cutting the repo rate by 50bps to 5.5%, citing easing inflation and a need to support growth. Additionally, the CRR was reduced by 100bps, to be implemented in four tranches between September and November, aimed at improving systemic liquidity. India's macroeconomic data reflected a moderation in price pressures, with CPI inflation easing to 2.8% in May from 3.2% in April. IIP growth fell to 1.2% from 2.7% in the prior month. FIIs were net buyers in the secondary market, purchasing around USD 1.9 billion worth of equities, while DIIs remained buyers of USD 8.5 billion during the month.
Market Outlook
The surprise rate cut and measures to ease funding scenario for key sectors are expected to enhance credit transmission and consumption. As global volatility continues to reduce, India's relative economic stability and improving inflation trajectory position it as an attractive investment destination. Barring intermittent volatility on the back of Trump's tariff measures, Indian markets should do well on the back of stable macro economic parameters and improving rural consumption. Going forward, investor focus will remain on the upcoming earnings season, monsoon progress, and clarity on USA's tariff stance. A portfolio approach favouring domestic consumption oriented sectors such as Consumer Discretionary, FMCG, real estate should offer favourable risk-reward in the current landscape.
Happy Investing!
Investments in securities market are subject to market risks. Read all the related documents carefully before investing. This content is for general information and is not investment advice. Past market movements do not indicate future performance. Please consult your financial advisor.
Indian equity markets extended their positive momentum in May, with Nifty50 Index rising by 1.7%, marking the third consecutive month of gains on the back of positive global cues on tariff front and revival in FII flows. Broader markets fared even better, with mid-cap and small-cap indices outperforming large caps, recording strong returns of 6.1% and 8.7%, respectively. Sectoral performance was largely positive, with almost all sectors ending in green, barring FMCG. Capital goods, real estate, and metal sectors led the rally, reflecting investor optimism around infrastructure and cyclical recovery.
Globally, equity markets maintained their upward bias, supported by improving sentiments. Germany, USA and Indonesia posted notable gains of over 6% during the month. Indian markets were initially under pressure in early May due to heightened geopolitical tensions with Pakistan. However, the situation stabilized after both countries agreed to a ceasefire, helping domestic equities recover. Mid-month, markets were buoyed by a breakthrough in trade talks between the US and China, which included an agreement to reduce tariffs on a temporary basis.
Moody’s downgraded the US sovereign credit rating, citing concerns over rising debt levels. RBI monetary policy committee front loaded rate cuts by reducing repo rate by 50bps to 5.5% in its June meeting. RBI also announced a significant surplus transfer of ₹2.7 trillion to the central government for FY2025, which is expected to support fiscal spending and investment activity.
Encouragingly, India's real GDP growth for the fourth quarter of FY2025 accelerated to 7.4%, up from 6.4% in the previous quarter, reflecting underlying strength in domestic demand. FIIs bought US$2.1 billion worth of equities during the month while DIIs were net buyers to the tune of US$7.9 billion.
Market Outlook
Despite early uncertainties stemming from geopolitical tensions and mixed global cues, Indian equities managed to end May on a firm note, supported by robust domestic fundamentals, resilient corporate earnings and strong institutional flows. The temporary easing in global trade tensions offered some relief, though concerns remain elevated due to unresolved issues around reciprocal tariffs and recent rating downgrade of USA. Amidst global uncertainties, India has a robust growth outlook as demonstrated by a strong GDP print for Q4FY25. Also, corporate earnings growth is expected to be robust giving support to equity markets.
Looking ahead, India continues to be positioned as a preferred investment destination, driven by strong macroeconomic indicators, expectations of a healthy monsoon, benign liquidity conditions in banking system and improved earnings visibility. While volatility may persist amidst global headwinds, sectors like capital goods, real estate, and industrials are expected to benefit from policy tailwinds and rising capex. A selective and quality-focused investment approach remains key in the current environment.
Happy Investing!
Investments in securities market are subject to market risks. Read all the related documents carefully before investing. This content is for general information and is not investment advice. Past market movements do not indicate future performance. Please consult your financial advisor.
Equity markets continued their upward trajectory in April, with the Nifty50 Index gaining 3.5%. Mid-cap and small-cap indices also participated in the rally, rising 4.7% and 2.2%, respectively. Almost all sectors ended in the green, with consumer durables, oil & gas, and FMCG leading the way—each up over 5%. Metals and IT were the only laggards, declining 5.8% and 3%, respectively. Global markets delivered a mixed performance, with Mexico (+6%), Indonesia (+3.9%), and Australia (+3.6%) posting solid gains, while the US (Dow), Hong Kong, and Singapore saw declines of 4.6%, 4.3%, and 3.5%, respectively.
Key developments during the month included the RBI’s announcement of an Open Market Operation (OMO) purchase to infuse liquidity, a 25 bps repo rate cut to 6% along with a shift to an accommodative policy stance, and a relaxation in liquidity coverage ratio (LCR) norms aimed at enhancing credit flow. On the international front, the US President initially announced sweeping reciprocal tariffs but later issued a 90-day pause for all countries except China. The IMF cut India’s FY2026 GDP growth forecast to 6.2%, citing rising global trade tensions. On the positive side, the IMD predicted above-normal monsoon rainfall this year.
FIIs bought USD 936 million in Indian equities, while DIIs were net buyers to the tune of USD 3.1 billion during the month.
Market Outlook
Despite recent positive developments on trade negotiation by USA, global trade tensions remain a significant overhang for equity markets. The rollback of tariffs for countries other than China provides temporary relief, but the broader uncertainty persists. In India, current geopolitical tension with Pakistan creates an additional layer of uncertainty for markets. However, action on FII flow recently suggests that India remains as one of the preferred destinations for investment by FIIs considering its growth-inflation dynamics. India's strong domestic demand and potential positive trade negotiation outcomes with the US may limit downside risks for our markets. Investors should remain cautious yet optimistic, focusing on quality names in sectors like banking, consumer discretionary, and industrials, which are expected to benefit from favorable policy support and stable domestic fundamentals.
Happy Investing!
Investments in securities market are subject to market risks. Read all the related documents carefully before investing. This content is for general information and is not investment advice. Past market movements do not indicate future performance. Please consult your financial advisor.
Equity markets rebounded strongly in March with Nifty50 Index gaining 6.3% after five consecutive months of decline. Mid-cap and small-cap indices also gained 7.8% and 9.5%, respectively. Except IT, which declined by 1.5%, all sectors ended in green. Power, PSU, capital goods, oil & gas, and metals were the leaders. Market sentiment remained cautious due to lingering concerns over US trade policies under President Trump. Optimism improved following the Federal Reserve's indication of two potential rate cuts this year, alongside a notable improvement in foreign inflows. Brazil, India, and Indonesia posted gains of 7%, 6%, and 4%, respectively, while Taiwan, the US, and Malaysia saw declines of 6%, 6%, and 4% respectively.
Key developments during the month included the FOMC keeping policy rates unchanged at 4.25-4.5%, retaining projections of two rate cuts in 2025. On the economic front, February's Consumer Price Index (CPI) inflation in India eased to 3.6% from 4.3% in January, mainly due to moderating food prices while Industrial Production (IIP) growth improved to 5% in January from 3.5% in December, reflecting a pickup in the manufacturing sector. FIIs bought USD737 million in the Indian equity market, while DIIs bought USD975 million during the month.
Market Outlook While the market rebound in March provided some respite to market participants, sharp tariff hikes by USA on imports in early April has created uncertainty in equity markets globally. With retaliation by other countries looming large, growth prospects of USA and most other countries including India are expected to be adversely impacted due to the tariff hikes. Global supply chain and consumer behaviour may take a severe hit unless tariff hikes are rolled back soon. The policy action related to trade tariffs will be the single most important factor influencing global markets in near term. While risk-off sentiments globally will have a negative impact on the Indian equity market in the short term, we believe India will come out of this adverse situation relatively better than many other emerging countries. A strong domestic demand and a probable favourable outcome of trade negotiations between the USA and India should result in lesser impact on India's growth prospects in FY26. Amidst a volatile market environment investors are advised to remain selective, focusing on quality stocks in domestic oriented sectors such as power, banking, industrial and consumer discretionary, which are expected to benefit from domestic demand and falling commodity prices.
Happy Investing!
Investments in securities market are subject to market risks. Read all the related documents carefully before investing. This content is for general information and is not investment advice. Past market movements do not indicate future performance. Please consult your financial advisor.
Equity market weakness continued in February with Nifty50 Index declining by 5.9%. It was Nifty's fifth consecutive month of loss which is a rarity and has come after almost 3 decades. Mid-cap and small-cap indices underperformed Nifty significantly, falling by 10.8% and 13.1%, respectively as profit booking was witnessed across the board. All sectors fell, with capital goods, PSUs, and real estate showing sharp declines of 14.4%, 13.5%, and 13.4%, respectively. Market sentiment was weighed down by uncertainty surrounding US trade tariffs, weaker-than-expected corporate earnings, stretched valuations, and strong outflows by FIIs. India underperformed most global markets with strong gains in Hong Kong, Germany, and Mexico, while Indonesia, Thailand, and Japan faced notable declines.
Key developments during the month included the Union Budget for FY2026 maintaining a gradual fiscal consolidation approach while introducing measures to boost consumption. RBI began the rate-cut cycle with a 25-bps reduction in the repo rate to 6.25%. Also, RBI eased risk-weight norms for bank lending to NBFCs and microfinance institutions easing credit flow into these sectors. FIIs continued their selling streak, with outflows of $4.7 billion worth of Indian equities and DIIs stepped in with net purchases of $6 billion during the month.
Market Outlook
The equity market has continued to witness sharp correction over the past few months, particularly in the mid and small-cap segments due to aggressive FII selling exacerbated by weakness in economic and earnings growth. Trade policy by president Trump has created additional uncertainty for the markets. However, we consider this correction as a short-term volatility in the market as India’s structural growth drivers i.e. robust domestic consumption, revival in capital expenditure and a resilient banking sector continue to support long-term equity market prospects. Post this correction market multiples have come to a reasonable level compared to the historical average. With expected uptick in both GDP and corporate earnings growth from Q4FY25 onwards, investors are advised to focus on quality stocks in sectors such as healthcare, banking, consumer discretionary and industrial to accumulate in this market correction.
Investments in securities market are subject to market risks. Read all the related documents carefully before investing. This content is for general information and is not investment advice. Past market movements do not indicate future performance. Please consult your financial advisor.
In December, the Nifty50 Index declined by 2%, ending the year with an 8.8% gain in CY2024. Mid-cap and small-cap indices outperformed, rising by 1.4% and 0.6% in December and delivering robust gains of 23.9% each for the year. Healthcare and realty were the best-performing sectors during December and 2024, while power (-7%), metals (-5.4%), and PSU (-5.2%) indices faced notable declines. Global markets ended on a mixed note, with Japan (+4.4%), Taiwan (+3.5%), and Hong Kong (+3.3%) gaining, while the US Dow Jones (-5.2%), Brazil (-4.3%), and the US SPX (-2.4%) declined.
Key developments during the month included the RBI maintaining the repo rate at 6.5% while cutting the CRR by 50 bps, and the US Fed reducing interest rates by 25 bps with fewer cuts expected next year. Japan approved a record $732 billion budget for FY2025, while the Asian Development Bank revised India’s FY2025 GDP growth forecast down to 6.5% from 7%.
On the economic front, CPI inflation eased to 5.5% YoY in November from 6.2% in October, and WPI inflation fell to 1.9% from 2.4%. Industrial growth, as measured by IIP, improved marginally to 3.5% YoY in October from 3.1% in September. The current account deficit for 2QFY25 came in at 1.2% of GDP. Institutional activity remained mixed, with FPIs buying $59 million of Indian equities, while DIIs invested $4 billion till December 31.
Market Outlook
Looking ahead, India’s structural strengths, including strong domestic demand and government-led infrastructure spending, support a positive long-term outlook for equity markets. Investors are advised to focus on quality stocks in sectors like healthcare, IT, banking, and realty, using market corrections as opportunities to build long-term positions.
Happy Investing!
Investments in securities market are subject to market risks. Read all the related documents carefully before investing. This content is for general information and is not investment advice. Past market movements do not indicate future performance. Please consult your financial advisor.
