Kotak Securities one of the largest share broking firm in India brings you various outlook from Indian share market for the year 2013. Learn how did this year performed for various investors and market. For more such market outlook visit our blog kotaksecurities.blogspot.com or our website www.kotaksecurities.com
2013 - The year that was
2013 – The year that Stocks
•Diwali holidays bring with them an
opportunity to take a step back. This is
a good time to look back at events
that influenced investments in the year
gone by. Developments in 2013 give a
peek of challenges that lie ahead for
Indian stock markets.
changed much as compared to the
beginning of the year 2013, despite a
slow economic and corporate profit
How FIIs Behaved in 2013
•Foreign Institutional Investors invested over $ 13bn in 2013 in Indian
equities. FIIs have hung on to their investments despite a 10% fall in the value
of the rupee and their investment, witnessing the value of their portfolio decline
10% as a result.
•It is possible that FIIs would continue to bring in the money. But we will
have to contend with uncertainties over US debt situation and Fed taper in the
Looking At Mutual Funds
•Domestic Institutional Investors have
been net sellers to the tune of $8bn
in 2013. This indicates that retail
investors in India are taking the money
out of the stock market.
•Equity as an avenue for investment
fell to 4% of overall individual savings
in 2012-13 (as mentioned in the RBI
Annual report 2012 – 13). RBI data
suggests that it has been falling
consistently for two decades.
•The year saw companies that earn
revenue in foreign exchange perform
better in the stock market as the rupee
tumbled. Top performing companies
in 2013 were from technology and
pharmaceutical sector. Automobile
Motors, that receive most of the
revenue and profit from Jaguar Land
•The sluggish trend in the macro-
Performance of the Macro-Economy
•The Rupee’s fall due to a high current account deficit remained the
dominant theme on the macro-economy front. Inflation was another highlight
of the year.
•As India’s exports growth struggles due to the slowdown in export
markets, consistent high imports (crude oil, etc) increase the money
India owes the world. This created demand for more US dollars and less for
rupees resulting in the sharp fall in the rupee.
•International agencies like World Bank and IMF have cut India’s growth
forecast to close to or less than 4% per annum.
•The Reserve Bank of India has battled high inflation through the year. It has
held lending rates firm in 2013 to combat the surge in the inflation. This year Dr.
Raghuram Rajan took over as the new governor of RBI from D Subbarao.
•India needs to manage high growth and at the same time keep inflation low.
It’s a challenge for the new governor.
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