The Indian equity markets crumbled in the month of July - BSE Sensex and S&P Nifty both ended in the negative territory, down by 3.44% and 2.93% respectively. The small and midcap indices however made some decent gains in the month. BSE Metal and BSE Capital Goods were the worst hit sectors in the month. BSE Consumer Durables and BSE FMCG were the top gainers for the month.
On 26th July, 2011 the Reserve Bank of India hiked its key policy rates, repo and reverse repo, by 50 basis points each. After this hike, the repo rate now stands at 8% and the reverse repo at 7%. This is the 11th consecutive rate hike aimed at managing inflation. A higher than expected hike evoked negative response from the equity markets and markets witnessed a big fall after the announcements from RBI.
The global situation continues to be uncertain, with bad news coming in from USA and Europe. While an immediate US default has been avoided, concerns remain on the possibility of a downgrade of US paper. These events have a bearing the on the entire globe, including India. However, as before, our domestic consumption story remains intact, and hopefully this theme will continue to play out in the country’s growth expectations.
MSFU – Emerging Businesses Fund continues to be one of the top performing equity diversified fund from SBI Mutual Fund. Besides, 3 of our debt schemes viz; Magnum InstaCash Fund - Liquid Floater Plan – Growth, SBI Premier Liquid Fund - Institutional – Growth and SBI Short Horizon Debt Fund - Ultra Short Term Fund - Retail – Growth have received Crisil Mutual Fund Rank 1 for the quarter June 30, 2011. We shall continue to endeavour to deliver such high class performance in the future for all our schemes.
Retail investor can park their short term surplus funds in these liquid / ultra short term schemes and optimize their portfolio to benefit from the high inflation and tight liquidity scenario. Retail investors should also look at FMPs of different maturities as they offer better post tax returns. SBI Mutual Fund has launched several FMPs and will continue to do so to fulfill investor’s requirements.
I am glad to share with you that SBI Mutual Fund has won the Reader’s Digest Trusted Brand - Gold Award 2011 in the Investment Fund Company category. I would like to thank all the investors for placing trust with SBI Mutual Fund. We hope you would continue to partner us in your future endeavours too.
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