September Series
With Indian stock markets entering the September series, investors and analysts collectively hold their breath in the hope that this may finally be the month when the long overdue correction in the markets may finally happen. At a time when the sgx Niftyand Sensex sit at lifetime highs, the market trajectory has indeed been impressive on strong domestic and global factors. Despite this historical trend, the benchmark indices have consequently gained almost 16% year to date until now, supported by positive FII flows following continued positive domestic and global cues.
Historically, September has tended to be a volatile month in which pullbacks from a robust rally are very commonly observed. With mixed signals from global central banks and geopolitical uncertainties, the stage is indeed set for what could turn out to be an eventful period for the markets.
SGX Nifty has closed the month of September in negative territory for six times in last ten years with an average return of -0.6% for the month, which has been traditionally a weak month for the markets based on seasonal trends. The index has been on a winning streak and has achieved this feat of successive close in the green for the first time in 12 successive trading sessions since 2007.
Conclusion
While September is known to be a painful month for the Indian stock market, all signals and most experts do indicate that even if a correction were to happen, it would be short and not big.
Investors may want to stay updated and do a fine balance of fundamental and technical research in making investment decisions over the next few weeks.