Markets in October and predictions for November

 Value% 1-M change Value% 1-M change
Sensex34442.05-4.93S&P BSE IPO3969.89-4.4
Nifty10386.6-4.98S&P BSE India 10 Yr Sovereign Bond490.661.96
P/E*22.01--NSE India VIX#19.797516.49
P/B*2.85--INR | USD Exchange rate73.76281.98
Div yield1.3--Gold rate (Rs)@317404.03
Large4022.84-4.64Inflation rate^ (%)3.770.08
SMID Cap3837.97-1.33S&P BSE Realty1679.8-1.36
Source: BSE, NSE. As of October 31, 2018, *For Sensex, #India Volatility Index. @For 10 gms. ^Consumer Price Inflation for previous month. 1M change indicates percentage point change in inflation rate. S&P BSE IPO tracks the current primary market conditions in the Indian capital market and measures the growth in investor's wealth, within a period of two years, after listing of a company.

Highlights during the month

Markets this time witnessed one of the worst Octobers. in nearly a decade. Historically, October is considered worst for bulls and the month has previously witnessed some of the biggest crashes, namely – October 2008, October 1987 and October 1929.

Indian equities ended in the red for October, with domestic events weighing on the investor’s sentiments. Which were dented with the sharp decline in rupee and rising crude oil prices. Also, the sentiments around liquidity in the financial services sector remained the essential flavour of the month. The market continued to discount the fact that one of the largest NBFCs defaulted in the payment of interest, on its commercial paper borrowing.

Some of the other developments during the month are detailed as under:

  • The government moved to National Company Law Tribunal (NCLT) for the change of management at the crisis-hit IL&FS. The government won the takeover of all the IL&FS companies and replaced its board members with immediate effect
  • Reserve Bank of India (RBI) To Inject Rs 40,000-Crore Liquidity Into System In November
  • RBI released guidelines for interoperability between banks, mobile wallets, and prepaid cards
  • SEBI Proposed Relaxed Norms For Startup Listing
  • India’s fiscal deficit reached 95.3% of FY19 target in H1FY19
  • Unemployment rate reached a 2-year high of 6.9% in October 2018
  • The number of digital payment transactions in India touched 244.81 crores in October 2018, more than three-fold rise from October 2016
  • Ayushman Bharat – National Health Protection, will benefit 500 million Indians or 100 million families, by providing health insurance of up to Rs 5 lakh per year

 

Things to watch out for, in November 2018

  • Developments with respect to US, Iran, and OPEC countries pertaining to crude oil
  • Crude oil price trajectory and Rupee trajectory with respect to US Dollar
  • Earnings for the quarter ended September 2018 for India Inc.

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