Top Investment Manager Analyzes August 2024 Performance of India's Equity Market - SEO Optimized Content
August 2024 saw a mixed performance in India's equity market, with the MSCI India Index delivering a positive return of 0.9%. Despite this gain, the index underperformed the EM Index by 0.5 percentage points, placing India 15th out of 24 EM countries, according to analysts from Morgan Stanley.
In July, India ranked 10th among its EM peers, showing a decline in August. The benchmark Sensex index rose by 0.8% but lagged behind the Mid-cap and Small-cap indices. All indices made fresh life-time highs, indicating a strong yet relatively muted market momentum compared to the broader EM landscape.
Defensive sectors led the Indian market in August, with Communication Services and Healthcare being the top performers. Technology also outperformed its EM counterparts, reflecting strong investor confidence in India's tech sector.
However, Utilities was the worst-performing sector, both in absolute terms and relative to its EM peers, reflecting challenges in the energy and utilities space.
Institutional buying in India remained strong, with total inflows surpassing $42 billion for 2024. Market breadth remained strong, with 94% of stocks trading above their 200-day moving averages.
Despite low volatility, the put-call ratio rose, suggesting a modest uptick in bearish sentiment among traders. The 12-month forward price-to-earnings ratio increased to 24.3x, reflecting investor optimism. The Indian Rupee depreciated against the US Dollar and Euro in August.
India's bond market showed signs of easing, with slight changes in yields. In the commodities sector, oil prices decreased while gold prices increased.
In conclusion, despite some underperformance, India's equity market showed resilience in August 2024, with strong institutional buying and positive market breadth. Investors should pay attention to sector performance, currency movements, and bond market indicators to make informed decisions.
