In the fortnight from 15th to 31st May, 2018 U.S.-China trade war tensions once again came to the fore. Fresh differences among U.S. and North Korea too arose, which were later sorted. These together with other issues dragged major global markets down.
U.S. President planning to impose tariffs on Canada, Mexico and the European Union (EU) and possible retaliation from their side made investors nervous. Positive economic data restricted the fall.
Uncertainty over political situation in Italy and Spain dominated European market sentiment during the period.Economic data offer much support as Eurozone and Germany private sectors grew at a weaker pace in May 2018.
Asian markets too felt the heat of the sell-off in global counterparts. Market sentiment remained subdued as speculations over a global trade war resurfaced.
Indian equity market had to deal with weak economic data at home together with the global worries. Wholesale and retail-price based inflation both increased for April 2018 and factory output slowed for March 2018.
The Banking sector gained during the period with all the major banking indices moving upward. However, major state-run banks reported losses during the 4QFY18.
The oil & gas sector witnessed weakness during the period. Fears that the government may impose a windfall tax in order to moderate the surging fuel prices led to fall in oil & gas stocks.
The auto sector saw a major player report downbeat earnings for the quarter ended March 2018, but losses were cushioned when China said it will steeply cut import tariffs for automobiles and car parts.
Rupee gained against the dollar as minutes of U.S. Federal (Fed) May meeting hinted the bank might increase rates moving forward at a modest pace.
Source: MFI Explorer
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