Usually, returns from most mutual funds are around the category average with just a handful of them outperforming or lagging behind in a big way. But the extent of outperformance or underperformance seen in smallcap funds since January 2018 has been extreme, with the performers delivering 22-26 per cent returns and laggards 2-6 per cent. Analysts cite higher cash in portfolio, more churn and lower assets under management as key differentiators of performers from non-performers.
STREET PULSE: Where we stand Nifty futures on the Singapore Exchange traded 36 points higher at 7 am (IST), indicating a good start ahead for Dalal Street. Shares in the rest of Asia looked set for another cautious session on Tuesday, as investors tried to judge how quickly China's factories could return to work as the coronavirus continues to spread and deaths mount.
HERE'S WHAT TO WATCH  | MSCI's broadest index of Asia-Pacific shares outside Japan inched up 0.1% with the Australian market rising 0.6% and South Korea's KOSPI lifting 0.7%. Japan's Nikkei was closed for a holiday. |
| US stocks reversed early losses on Monday, helping Dow to grind a step closer to the 30,000 mark despite a spate of alarming coronavirus headlines. Nasdaq surged 0.94% to 9,610, Dow climbed 131 points to 29,233, and S&P500 0.57% to 3,346. |
| Oil prices rose more than 1 per cent on Tuesday as recent sharp falls have encouraged investors holding short positions to book profits, but the market remains jittery over the Wuhan virus, which has now killed more than 1,000 in China. Brent crude rose 79 cents, or nearly 1.5 per cent, to $54.06 a barrel, while US West Texas Intermediate was up 63 cents, or about 1.3 per cent, to $50.20. |
| The rupee rose 10 paise on Monday to close at 71.30 against the US dollar amid easing crude oil prices and weakening of the American currency in the overseas market |
| LOOK WHO'S |  |
It's Advantage NCDs… The latest proposal to abolish the DDT and a shift in the onus of compliance to individual investors is making non-convertible debentures (NCDs) more popular at the expense of preference shares. Investors are now keener on high single-digit yields on debt papers of the Tata Group and Birla Group instead of the quasi-equity instruments. Preference shares were yielding 7.25% (yield-to-maturity) before the Budget, but the gauge is at 9% or above now. But buyers are rather rare even at such elevated levels.
Read More D'Mart on a High... Avenue Supermarts crossed Rs 1.50 lakh crore in market capitalisation on Monday, surpassing Nestle and Bajaj Finserv to become India's 18th most valuable company. The company listed on March 21, 2017 at a market capitalisation of Rs 39,988 crore has risen 290% since. Avenue shares rose 8.6% to close at an all-time high of Rs 2,484.15 on Monday after the company announced a share sale for institutional investors on February 5. The run-up in share price made Avenue's founder Radhakishan Damani, also considered an astute stock market participant, India's sixth richest person with a net worth of $11.9 billion, wealthier than Gautam Adani ($10.8 billion) and Sunil Mittal ($9.6 billion).
Read More Midcap Funds in Favour... Investors poured money into midcap and smallcap mutual fund products in January, driving up flows into the equity scheme category by Rs 7,877 crore against Rs 4,499 crore in December. Industry officials said cheaper valuations of the smaller shares and a rally in the broader market before the Budget resulted in fresh flows into these categories. In November 2019, flows had dipped to as low as Rs 1,311 crore. Meanwhile, inflows through SIPs in mutual funds hit another all-time high of Rs 8,532 crore in January, 2020, vaulting past a December record. AMFI data showed that for the 14th consecutive month, collections through SIPs have stayed above the Rs 8,000 crore mark.
Read More | WHO'S |  |
Motown Misery… Passenger vehicle sales in the local market dropped 6.2% to 262,714 units in January, amid weak demand and inventory correction by carmakers ahead of the transition to new emission standards in April. Sales of commercial vehicles fell 14% to 75,289 units last month, while two-wheeler sales declined 16% to 1,341,005 units. Among two-wheelers, scooters sales dropped 16.21% to 416,594 units and those of motorcycles fell 15.17% to 871,886 units.
Read More Amazon Challenge… Amazon on Monday filed a petition in the Karnataka High Court to "quash" the investigation ordered by India's competition watchdog into alleged malpractices by the online marketplace. The American company also sought an interim stay on the probe ordered by Competition Commission of India last month while its petition is heard by the court. In its submission, Amazon claimed that CCI's order would cause irreparable damage and loss to its goodwill.
Read More Meanwhile... Clueless on Growth… India's economy is experiencing a slower rate of growth across sectors and it's not easy to predict when demand is likely to recover, says ITC chairman Sanjiv Puri. "It's very difficult to say anything conclusively at this point of time. I am hopeful that sooner or later, we will start seeing an uptick," he said. The cigarettes-to-cookies conglomerate, which faces the highest exposure to agriculture within the consumer products market in terms of sales as well as sourcing, said farm incomes have to rise for India to get onto a higher and more sustainable growth trajectory.
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