WHAT IS BANK NIFTY?
Nifty Bank, or Bank Nifty, is an index comprised of
the most liquid and large capitalised Indian banking stocks. It provides
investors with a benchmark that captures the capital market performance of
Indian bank stocks. The index has 12 stocks from the banking sector.
The
top stocks of the index include HDFC Bank Ltd. 31.61%, ICICI Bank Ltd. 18.20%,
Axis Bank Ltd. 13.02%, Kotak Mahindra Bank Ltd. 12.74% and State Bank of India
10.92%. Bank Nifty, like others, is computed using free float market
capitalization method. It's index variant includes NIFTY Bank Total Returns
Index or Bank Nifty TRI. The index was launched in 2003.
The
down trend in the market
The Indian shares in particular hasrisen
as of July2nd, 2020. This alignment with the regulatory approvals of
COVID-19 drug production. Theapprovals single-handedly lifted the
pharmaceutical stocks. The clash in China has been putting stress on the stock
market as well. Despite this, the NIPHARM stock has surged at around 2.9%.
Nifty saw a rise in the index after the
U.S visa controls was tightened . Many IT companies may hit following the new
visa regulations in America. NIFTYFIN rose by 1% each and popular IT companies
saw a 1% fall in their shares. The US economy while battling the Coronavirus,
has decided to suspend entry of some foreigners. They believe it will be in the
best interest of their economy. Indian IT outsourcing companies rely on the
H-1B visa and will find it hard to deal with their biggest clients in the US.
The
fund dispersion of the NIFTY and SENSEX
On Thursday, 25th June
2020, the shares closed slightly lower. The International Monetary Fund
predicted that the Indian economy may shrink by 4.5% this year. The NSEI ended
at 0.16% to 10,288.90. The BSESN dropped
0.1% to 34,842.10.
After 4 years of hitting low the
Nifty 50 index has risen to about 37%. despite the continuing pandemic, the
economy saw foreign investment in the country.
The world stocks notably hit their
lowest in a week by Thursday.
The IMF has predicted the possibility
of a global retreat in the economy. Investors have been closely keeping a track
of the Coronavirus cases across the globe. Mayuresh Joshi, Head of equity
research at William O’Neil, Mumbai expresses that the liquidity is what is
compensating for the growth downgrades and increasing coronavirus cases in the
economy. The hope remains that central bankers will continue putting liquidity
infusing policies into action.
Market Statistics at a glance:
After a volatile week of trading, the
Indian market seemed to have shut down with a slight loss. Despite the increase
in Covid-19 cases, India will continue attracting FDI. A downfall was witnessed
in the consumption analysis which constitutes more than 60% of the economy .In
June,contraction of 29.18% was witnessed. This is in comparison to May, which
saw a 98% contraction due to the lockdown status in India.
On 14th June 2020, India
witnessed an improved employment rate, at least 3.3%. Since the reopening of
the economy, the rise from 32.4% to 35.7% has been a notable difference.
Recovery of Nifty:
Nifty and Sensex have risen by 0.3%
each. This has infused hope for the recovery of the global economy. The
following quarter is predicted to be thebest
in all of 11 years.
The NSE Nifty 50 index, NSEI had to
trade off profits and was up by 0.35% at 10,348. BSESN was up 0.33% to 35,079.
The market hopes seemed to be
uplifted by the profits raised in Asia and Wall Street almost overnight. The
chief executive of Esquire Capital, Samrat Dasgupta has stated that the Nifty
will continue trade in the 10000-10500 range. The coronavirus cases continue
rising, this creates lockdown fears in the market. This and a liquidity-driven
recovery will govern over the market for the next quarter.
The lowest hit of four years taken in
March has been recovering by June. The Nifty and Sensex are predicted to close
off 20% stronger by the end of the quarter.
The analysis shows that Tata Steel
TISC.NS, had the most gains in Nifty, the gains were up to 5.2%.
Conclusion
Shares worth 25 billion have been
bought by foreign investors. Institutional investors have been driving Nifty to
an all-time high. Surplus cash has been pushed into the central banks to
purchase into Mumbai.
The Nifty close down was the best
since March.
Due to the lockdown situation, the
local market has been performing poorly. Analysts have stated that this has
made the economy more enticing to investors.
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