Indian stock markets underperform global peers; six-day fall forces Sensex deep into red for 2021

Domestic equity markets have parted ways with their global counterparts in the first month of 2021. With six consecutive days of losses, Sensex closed the month of January 3.05% lower at 46,285. Even though Sensex did breach a historic milestone in the same month as it crossed the much-awaited 50,000 mark, the benchmark index ended 7.4% lower from there. “Indian equities deviated from the rest of the world (which saw flat or positive gains) and slid in January. The S&P BSE SENSEX saw consecutive declines in the final six days of trading to post a loss of 3% this month,” S&P Dow Jones said. 

Broader Markets

Although Sensex was the worst performed among domestic indices, others too were deep in red. S&P BSE Sensex 50 closed 2.39% lower, BSE 100 was down 2.12%, and BSE 200 slipped 1.95%. Meanwhile, the BSE 500 index 1.75% and BSE Allcap fell 1.73%. The Smallcap index too closed in red, falling 0.56%. However, the outperformer was the S&P BSE Midcap index, gaining 0.78%.

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“Only two of our reported Indian equity strategies rose this month. Enhanced Value and Low Volatility made an odd couple, gaining 3% and 0.4%, respectively. Momentum lagged more than the broader market to post a loss of 5%,” S&P said. Among various domestic sectoral indices, S&P BSE Telecom, BSE Industrial, and BSE Information Technology closed with gains while all other closed deep in red. S&P BSE Energy index fell 5.89%, the worst among the lot. 

Global Watch

On Wall Street, Dow Jones Industrial Average closed flat with a negative bias in January, after slipping 2% on the final day of trade. The S&P Asia 50, consisting of 50 leading blue-chip companies that are listed in four major Asian markets — Hong Kong, Korea, Singapore and Taiwan closed nearly 7% higher during the month. The S&P Emerging BMI, gained 2% during the same period. Among those that followed Indian indices into the negative territory were S&P TOPIX 150, consisting of large-cap Japanese companies along with S&P Latin America 40, which comprises of 40 blue-chip companies from Brazil, Chile, Colombia, Mexico and Peru.