Bharat Sanlokhe
All the major and sectoral indices closed in the red zone last week after a long, long day in the market. Only exception to IT index! It should also be called Flat. Asa Nifty fell by 2 percent, Bank Nifty by 2.35 percent and Sensex by 0.62 percent. ( Stock Market )
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Nifty Realty fell the most i.e. nine and a half percent. Shares of Sobha, Swan Energy, Macrotech Developers fell by fourteen and a half to eighteen percent. Shares of Godroj Properties, DLF, Prestige, Estates also fell by more than ten percent.
The irony for Macrotech Developers is that the stock hit an all-time high (Rs. 1277.90) on March 11 as the company raised Rs 3300 crore through Qualified Institutional Placement. In it and the promoter of the company, Sambhavanath Infrabuild and Farms sold 49.7 lakh shares at an average price of Rs 1180.02. Finally on Friday this share was Rs. closed at 1003.95.
FIIS sales are slowly cooling down. In the week he earned Rs. 816.94 crore net sales. DIIS is buying bulk goods. Their net purchase for the week was Rs. 14147.54 crores! The Nifty Small Cap and Midcap indices lost 5.5 and 4.5 percent respectively in the last week. In post-corona recovery, small cap and mid cap stocks showed a huge boom, so these stocks became the TOP picks of investors.
So much so that mutual funds companies either introduced several new fads in this category or increased the small cap and mid cap allocations in existing funds. The fund returned an average of 24 percent over the last five years; But alarm bells have started ringing in this category since last one month.
How much should this bubble of investment in mid cap and small cap stocks inflate? In two years 2022 and 2023, in small cap and mid cap funds Rs. More than one lakh crore has been invested.
Finally, Sebi chief Smt. Madhabi Puri Buch's comments about the creation of small cap and mid cap segment led to a sharp fall in small and mid cap stocks. Subsequently, Amphi also asked the asset management companies to take steps in this regard.
Shares of Solar Industries (Rs 8855.50), Linde India (Rs 6441.10) and Haig (Rs 1882.15) gained more than 10 percent during the week, while Tata Invest fell 22.5 percent. An article last week had sung the praises of the same stock; But rumors spread in the market that Tata Sons was reluctant to bring an IPO and the stock collapsed. There were three main reasons why the market fell this week. Among them, Sebi's concern about small cap and mid cap shares was one of the reasons. He has done it on his own terms.
The second reason is that the upcoming elections have a significant impact on the stock market of any country. It came naturally, because the country's fiscal policy, taxation system are important in determining the direction of the stock market; But if we look at the history of the last 20 years or four elections, the stock market has responded positively for six months before each election. Even in a huge country like India and a continent with huge population, elections are a very important event. Because the government's capital expenditure increases a lot before elections.
As India has a large rural population, investment in agriculture-related sectors increases and consumption increases. And finally on the third and last day of the market i.e. Friday about the cause of chaos in the market! This reason is electoral bonds! On Thursday evening, the Election Commission opened the Pendora Box of Electoral Bonds and there was a stir.
This Pandora's Box has yet to be opened. It is only slightly jarred; But the Supreme Court has taken a baton behind the SBI. What will the stock market and India's political horizon look like when it fully opens on Monday? However, investors should be consistent and very cautious. ( Stock Market )
