Bulls stomp out DeMo blues from markets

Mumbai: Six months after demonetisation, the Indian equity market has left the demonetisation blues far behind to become one of the best performing markets in the world this year. Many of the stocks had hit their lowest after the noteban move in the last few days of December and since then recovered as the impact did not turn out to be as bad as feared. A strong win by the BJP in the Uttar Pradesh elections, stable dollar and commentary of gradual rate hikes by the US Fed have also boosted stocks.

Real estate sector has been the best performer this year after the BSE Realty index lost 14.4% between demonetisation announcement and December end, by gaining nearly 62%. Consumer durables sector, that was thought to be a space which will see a prolonged impact, jumped 41% after losing 10% in the weeks after demonetisation.The capital goods and banking sector are also among the top performers, with their BSE sector indices gaining 29% and 25% respectively.

Sectors that are still underperforming include healthcare and information technology, which have been muted or fallen this year owing to global factors than domestic.