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Year End 2021: Sensex shows strength, stocks continue to set new records every day

There has been a real rally in the market and no sectoral indicators have been negative, indicating market enthusiasm.

Year End 2021: 2021 denies normal and writes script for new normal. Stocks have reached record highs, indicators continue to rise and hit new highs every day. Also, the returns obtained in this process have been excellent. All quarters took part in this gathering.

The 30-share S&P BSE Sensex has returned nearly 20 percent this year. In comparison, the BSE Midcap Index rose 35.8 percent and the BSE Smallcap Index rose 56.7 percent. This indicates that there is a bullish environment everywhere in the market. However, the BSE Largecap Index lags behind the Midcap and Smallcap indexes, giving returns of 22.5 per cent per annum.

Speaking to ShareIndia, Moneycontrol, Ravi Singh, Vice President and Head of Research, said: And corporate improvement. The main reason for the rally in the stock market was income.

Deepak Jaisani, head of retail research at HDFC Securities, said: “None of the indicators turned negative, indicating market upside.”

Speaking of the sector, FMCG, banks, finance, healthcare and auto showed recession, which gave lower returns than the benchmark Sensex. Jasani said the BSE FMCG index rose 7.3 per cent “because margin pressures were under pressure due to rising raw material prices, silent volume growth and fears of a business collapse due to earnings pressures.”

Bank

The BSE Bankex Index rose 10.3 percent, while the BSE Private Bank Index rose 2.8 percent and the Nifty PSU Index rose 42.4 percent. The performance of the finance sector was similar to that of banks and could get only 11.7 per cent return per annum. Jasani said bank stocks were not attractive due to excessive ownership, asset quality problems and slow credit growth.

Healthcare

Including pharmaceuticals, the healthcare sector grew 14.8 percent, while pharma grew only 4.5 percent.

Pushkaraj Sham Kanitkar, VP (Equities), GEPL Capital, said:

“Indian units have not yet been cleared under FDA (US Food and Drug Administration) scrutiny and other treatments have been suspended due to covid concerns,” Jasani said.

Let’s look at the 5 mutual funds that collected records during their NFO in 2021.

Automatic

“The non-protective auto sector has suffered a setback, mainly due to the shortage of semiconductors as well as the shift in the market to electric vehicles,” Kanitkar said. The BSE Auto Index has risen 15.7 percent this year. It has seen more movement in the Diwali season.

Power

The BSE Power Index was the best performing sector with a return of 68.9 percent. Jasani said, “As the demand for electricity has increased, so has the focus on renewable energy. Companies have renewed their models and strengthened the evaluation of global contracts. “

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Metal

The BSE Metal Index rose 65.2 as prices of manufactured goods rose due to supply chain constraints. High spending on infra and real estate has increased demand for metals. However, in the second half of the year, the prices of raw materials started falling.

Sonam Srivastava, founder, Wright Research, said, “The metals sector was booming at the beginning of the year due to global infrastructural strength and commodity prices touching a few years high.”

Realty, IT

Realty, information technology and capital goods were also among the top sectors providing around 50 per cent returns this year.

The BSE Realty Index rose 52.8 per cent on the back of increase in residential property sales, implementation of GST and establishment of sector regulators after the cancellation of the note. The reduction in interest rates and the reduction of stamp duty have also helped the sector.

At the same time, due to increasing demand for digitization in the Kovid era, the BSE IT index registered 52.4 per cent strength and companies got good deals.

Jasani said improved billing and devaluation of the rupee have resulted in better results for IT companies.

Kanitkar said the IT sector has directly benefited from people working in the ‘work from home’ or hybrid model.

The BSE Capital Goods Index rose 49.5 per cent on the back of policies like Make in India Initiative and Production Linked Incentive Scheme.

Outlook

Experts say that in addition to the well-performing sectors in 2021, in the new year, business and market interest in some undervalued sectors may increase.

Siddharth Khemka, head (retail research) at Motilal Oswal Financial Services, said, “Banking and auto halls are two sectors that have performed poorly, but are likely to go into hiding in 2022.”

Banking reform, credit quality and improvement of NPAs are the best things in many years.

From the second half of FY22, auto companies are expected to improve in terms of semiconductor deficits and inflation.

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