TOP EVENTS THAT SHOOK INDIAN
MARKETS IN THE PAST 6 MONTHS
NDA'S THUMPING VICTORY
Market got a major boost from the exit polls and results of the
general elections. After the exit polls, the Nifty rallied 3.7% giving a clear
mandate to the BJP government. BJP won 303 of the 543 seats on its own and that
brought an end to political uncertainty and instilled confidence among
investors on continuity of reforms. After
rallying about 10% so far in the year 2019 market might take a breather till
the full budget, which will be presented on July 5. there is a high
probability that markets could make a top and then tread in a range till the
Budget as Nifty is trading at extremely high valuations with upwards of 29x PE
on the higher end of the band.
RBI CUTS POLICY RATES
Reserve Bank of India (RBI) in its policy review meeting on June
6 expectedly cut repo rate by 25 bps and changed its policy stance from neutral
to accommodative citing growth concerns. This marked the third rate cut of the
year so far. RBI is likely to cut interest rates by another 25 basis points in
2019 due to weak growth momentum and inflation remaining within targeted
limits, Fitch Ratings said. Many other analysts also echoed this opinion. the
repo rate cut was broadly in line with expectations. The shift in gear from
neutral to accommodative removes ambiguity with respect to the direction of
rate action, she added.However, the central bank has not mentioned any special
package for NBFCs barring the appointment of the working group to look at
liquidity problem.
THE JET AIRWAYS SAGA
Shares of cash-strapped airline remained under pressure as the
company was forced to suspend its operations and finally was taken to the NCLT
by its lenders. On June 20, 2019 the share hit record low of Rs 27 after State Bank of India filed insolvency petition against the company to recover dues.
Country's largest lender State Bank of India approached National Company Law
Tribunal in Mumbai against cash-strapped Jet Airways on behalf of the
consortium of lenders. Jet Airways shares lost more than 80 percent in the last
six months.
