Domestic stock markets broke multiple records in year 2019 with the benchmark S&P BSE Sensex index scaling the peaks of 39,000, 40,000 and 41,000 for the first time ever. A number of events, starting from a full rebate for individuals with income up to Rs 5 lakh, to first the imposition of higher taxes on foreign investors, and then a corporate tax cut caught the markets by surprise while global cues such as negotiations on the US-China trade front pushed many investors on the back foot during the course of the year, say analysts.
Here’s how the share markets fared in 2019:
As of Monday’s closing, the S&P BSE Sensex index has so far this year risen more than 15 per cent (year to date), which means the index is set to clock its best annual gain in past two years.
The broader NSE Nifty benchmark has clocked a gain of nearly 13 per cent during this period. Last week itself, it broke a series of records to hit an all-time high of 12,293.90, seven months after crossing the 12,000 mark for the first time ever (May 23, 2019).
Out of the Nifty 50 basket of shares, 29 stocks have registered gains so far this year. Bajaj Finance, ICICI Bank and Bharti Airtel emerged the top percentage gainers on the index, up 56.46 per cent, 51.88 per cent and 43.70 per cent respectively.
| Stock | % Change YTD (As of December 23) |
|---|---|
| YESBANK | -72.08% |
| GAIL | -67.06% |
| HCLTECH | -41.15% |
| Zee Entertainment | -40.18% |
| HDFCBANK | -38.78% |
| M&M | -34.07% |
| VEDL | -28.29% |
| WIPRO | -23.59% |
| UPL | -23.51% |
| NTPC | -23.38% |
| TITAN | +29.55% |
| ASIANPAINT | +30.79% |
| NESTLEIND | +33.39% |
| BPCL | +34.53% |
| KOTAKBANK | +35.22% |
| RELIANCE | +39.14% |
| BAJAJFINSV | +43.30% |
| BHARTIARTL | +43.70% |
| ICICIBANK | +51.88% |
| BAJFINANCE | +56.46% |
However, the journey so far has been led by movement in select large cap stocks while broader markets have lagged. Midcap and small cap stocks have underperformed their larger peers.
For the year, the S&P BSE Midcap and Smallcap indices are down 4 per cent and 8.99 per cent so far – a second straight year of downward movement for both. In 2017, the midcap gauge had risen 48.13 per cent and the smallcap index 59.64 per cent.
The year 2019 was also characterised with few wild moves as the Street reacted to Lok Sabha elections, the first full Budget of the NDA government after its return to power and announcements such as a cut in corporate taxes, say analysts. Economic slowdown, soaring inflation and aggressive easing of monetary policy drove investor sentiment.
The benchmark index closed 0.99 per cent lower on July 5, the day the government Union Budget its budget. Analysts say the government’s announcement that foreign investors will be taxed at a higher rate hurt investor sentiment. The Sensex extended its fall and closed 2.01 per cent lower the next day.
In August, the government withdrew the higher taxes on foreign investors – as announced in the Union Budget in the previous month – pushing the Sensex 2.16 per cent higher the next day.
The government’s move to lower the corporate tax rate to 22 per cent from a base rate of 30 per cent – lowering the effective new rate including all additional levies to 25.2 per cent from 35 per cent – triggered a jump of 2,284.55 points (6.33 per cent) in the Sensex. That marked the biggest single-day gain in the Sensex since 2009.
Source: NDTV Profit
