Sip and savour a delicious mix of market trends and updates that shaped last month’s stock market.
In October, the Indian financial markets experienced various events and fluctuations that influenced investor sentiment.
Interest Rates and RBI MPC Meeting:
- The Reserve Bank of India (RBI) held its MPC meeting during the first week, keeping interest rates unchanged at 6.50%. The focus was on withdrawing accommodation to align inflation progressively with the 4% target while supporting growth. The GDP growth forecast for FY24 remained at 6.5%.
- The benchmark indices, Sensex and Nifty, saw a dip of nearly 3 percent. They fluctuated weekly based on various factors.
- Crude oil prices fluctuated a lot and trades around $90/bbl on account of geopolitical tensions, demand outlook, crude oil reserves, etc.
- Foreign Institutional Investors (FIIs) continued to be net sellers.
- Throughout the month, different sectors remained in focus, including Media, IT, PSU banks, Realty, Metal, Auto, and others, based on their performance and market dynamics.
Market Sentiment and Resilience:
- Geopolitical events, such as the Israel-Hamas war, initially affected market sentiment. However, they rebounded due to dovish comments from US Fed officials.
- Strong Q2FY24 business updates, stable crude oil prices, and positive economic data contributed to market resilience.
- Quarterly results were generally positive, with no significant negative surprises.
- Challenges included rising bond yields, the US 10-year bond yield spiking to a 16-year high of close to 5%, and persistent FIIs selling.
- Markets experienced a significant decline during the last week, with Sensex and Nifty falling by more than 3%, primarily due to falling US and Asian markets, geopolitical tensions, and rising bond yields.
- Investors will monitor the crucial FOMC meeting scheduled between October 31 and November 1, 2023.
- Apart from this, market participants will closely monitor the updates on the Israel-Hamas war, the upcoming festive season and the remainder of the Q2FY24 earnings.
Despite various challenges and fluctuations, the market maintained its resilience and demonstrated the ability to rebound from adverse conditions. This monthly summary provides an overview of the market’s performance and the key factors influencing it during October.