Indian equity market place benchmarks BSE Sensex and Nifty 50 ended decrease in April, mainly on account of current record surge in COVID-19 instances and fresh impositions such as lockdowns and curfews to curb the spread of deadly illness, which weighed on investor sentiment. The 30-share Sensex tanked 1.5 per cent whilst NSE’s Nifty fell .4 per cent in the month of April. In comparison, US stock indices, Dow Jones, tech-heavy Nasdaq Composite and S&P 500 indices surged up to 5.4 per cent, mostly driven by robust financial recovery prospects supported by sustained fiscal policy help and US Federal Reserve’s assurance to provide ample liquidity help, Madan Sabnavis, Chief Economist, CARE Ratings mentioned in a report. According to CARE Ratings, the important drivers of the stock markets have been upbeat corporate earnings, mass vaccination drives and phased reopenings, sustained policy help, enhanced worldwide financial outlook and much better than anticipated macroeconomic information.
On the contrary, elements such as surge in coronavirus instances and deaths, lockdowns and curfews, elevated US treasury yields, inflationary issues and issues about vaccination drives have been mong ket stock market place draggers. The spread of COVID infections and spike in deaths in some nations like India, Japan along with enhanced restrictions/curbs to include the spread of the virus have also darkened prospects of the pace of financial recovery.
Sensex, Nifty worst performers in April 2021
Investor sentiment in India and Japan have been dampened the most due to a surge in coronavirus instances and new lockdown measures threatened the corporate earnings and financial recovery prospects. The benchmark indices in Japan (Nikkei 225) fell by 1.3 per cent as at finish April. While Shanghai composite, China’s stock market place index, ended flat and South Korea’s KOSPI ended greater by 2.8 per cent at April 2021-finish.
“The risks about the pace of economic recovery, darkening prospects of economic outlook and the reversal in the recent green-shoots seen in the Indian economy has led to pull-out from the foreign investors,” CARE Ratings noted. Weak macroeconomic information coupled with provide issues in case of India’s affordable progress in mass-vaccinations pressured investor sentiments and dragged equity markets decrease.
US stocks surge more than 5% in April
Key equity market place indices in the US ended greater in April compared with the earlier month-finish with Dow Jones Industrials ending 2.7 per cent up whilst the gains in tech-heavy Nasdaq Composite and S&P 500 have been more robust at 5.4 per cent and 5.2 per cent, respectively. Robust macroeconomic information for the US economy along with the US Federal Reserve reiterating its narrative of accommodative monetary policy, sustained liquidity help, status quo on policy interest prices, buoyed investor sentiments. While US investors remained cautious in April and gains have been capped owing to sharp rise in COVID instances, deaths and consequent lockdown restrictions in some nations, which raised fears about the nascent financial recovery.
European equity markets jump on robust financial recovery prospects
Major European stocks also closed broadly greater in April 2021. FTSE one hundred jumped 3.8 per cent, CAC 40 rose by 3.3 per cent whilst the gains in Germany’s important benchmark index DAX have been muted at practically one per cent. Investor sentiments in European equity markets have been driven by stronger prospects of financial recovery reflected by much better-than-anticipated improvement in higher frequency indicators (improve in customer self-confidence, Eurozone’s organization activity index), upbeat corporate earnings for the 1st quarter of 2021 and enormous inoculation drives in a quantity of European nations.