- “Bank FD sahi hai, post office sahi hai, gold sahi hai, Indian equities worst hai” reflects rising frustration among retail investors amid weak market performance. Investors are increasingly comparing 1-year, 2-year and 3-year mutual fund returns amid continued volatility in Indian equities despite global markets remaining relatively resilient.
- As per market grapevine, policy responses appear reactive. At Nifty 26,000 taxes were raised, at 25,000 STT was increased to curb speculation, at 24,500 retail investors were expected to absorb shocks, and only near lower levels discussions around tax relief started emerging. Investors hope timely action may help rebuild confidence.
- As per market veteran, the Nifty Midcap Index may continue to re-rate, with midcaps preferred over large caps. FY27 earnings cuts of 2-5% are expected, while Q2 may reflect the impact of higher fuel prices. Indian IT is expected to benefit from the next phase of AI adoption over the coming four quarters. Defence, hospitals, energy security, capital goods, and select small- & mid-cap stocks remain preferred themes.
- As per market grapevine, the Government should consider relief in LTCG tax on equities & bonds, lower withholding tax on government bonds and measures to support capital inflows. Such steps may improve investor confidence, support the rupee, strengthen external sector stability and revive positive sentiment across Indian capital markets.
- Big crash in Friday night closing: Dow closed -695 pts., Nasdaq -1122 pts., S&P -200 pts. and Gift Nifty -356 pts. at 23091, signalling a big gap-down opening for Indian markets on Monday. As per market grapevine, FFIs may continue selling till STT & LTCG taxes are reduced. Avoid stocks with heavy FII holding and focus on selected mid- and small-caps with zero FII holding, attractive valuations and strong dividend yield. Invest cautiously in AAA quality growth stocks amid the West Asia crisis.
- Big negative: FIIs sold massive Rs.31,114.47 cr. in the first 5 days of June, taking YTD selling to Rs.1,47,213.26 cr., which is highly negative for Indian retail investors and equity mutual funds. After Friday’s record selling, total FII selling crossed Rs.3.31 lakh cr. Another Rs.2-3 lakh cr. selling is possible if the Government does not reduce STT & LTCG tax. Most global markets delivered positive returns in FY26, while Indian markets remained weak due to higher taxes and continuous FII outflows as per market grapevine. Trade and invest cautiously.
- Take wise decision: FII shorts in Nifty contracts surged to 2.74 lakh, the second highest ever. Ignore the index as Nifty may remain under pressure in June-July. Reliance hit a fresh 52-week low on Friday. Focus on fundamentally strong mid- and small-caps available at attractive valuations and dividend yields. Nifty Smallcap 100 has broken out and is consolidating above 50 & 100-week SMAs. Sustaining above these levels could trigger a strong move ahead.
