Please upgrade your browser

We take your security very seriously. In order to protect you and our systems, we are making changes to all HSBC websites that means some of the oldest web browser versions will no longer be able to access these sites. Generally, the latest versions of a browser (like Edge, Chrome, Safari, etc.) and an operating system family (like Microsoft Windows, MacOS) have the most up-to-date security features.

If you are seeing this message, we have detected that you are using an older, unsupported browser.

See how to update your browser

Distributor corner

Equity Market Review

  • India was the best performing global market in April 2023 after lagging in March as RBI skipped an expected rate hike and strong FII inflow continued in April offsetting the slowdown in domestic flows.
  • India saw a broad based rally with S&P BSE Sensex & NSE Nifty indices gaining 3.6per cent / 4.1 per cent, respectively, during the month while BSE Mid Cap/BSE Small Cap indices jumped up by 6 per cent / 7.3 per cent, respectively.
  • RBI’s rate increase pause drove a strong rally in interest rate sensitive sectors. Real Estate was the best performing sector followed by Auto, Capital Goods and Banks. Healthcare, Oil & Gas and Metals also outperformed the Nifty. Only IT sector saw negative returns driven by weak results and commentary from most large caps.
  • Global market update: Major equity indices globally gained in April with MSCI World index up 1.6 per cent as the US market (S&P 500) climbed 1.5 per cent and MSCI Europe gained 3.6 per cent. MSCI EM however declined 1.3 per cent driven by a 5.2 per cent decline in China. Crude oil prices remained largely flat during the month.
  • FIIs were buyers of Indian equities in April to the tune of US 1.9 bn while DIIs were buyers only to the extent of US 0.3 bn. Domestic mutual funds saw an equity outflow of US 0.6 bn while insurance funds invested US 0.9 bn during the month.
  • CPI inflation dropped from 6.4 per cent (YoY) in February down to 5.7per cent (YoY) in March. Core-core inflation (i.e. core inflation ex petrol and diesel) remained sticky at 6 per cent but softened from 6.4 per cent (YoY) in February.
  • Index of Industrial production growth (IIP) in February stood at 5.6 per cent up from 5.5 per cent (YoY) in January.
  • INR appreciated over the month (up +0.4 per cent MoM) and ended the month at 81.83/USD in April. India’s FX reserves came in at US 584 bn. FX reserves have risen by US 5.5 bn in the last four weeks.
  • Other key developments during the month include – Gross GST revenue collection in the month of April 2023 stood at Rs 1.87 tn, up 12 per cent (YoY).
  • Valuations: Nifty FY24/25 consensus earnings have seen a further 1 per cent cut over the last 1 month. As a result, Nifty continues to trade on 19.2x FY24 PE. On a 10-year basis, Nifty is still trading 10 per cent above its historic average valuation but is now trading slightly below its 5-year average. However, in a rising interest rate environment, market returns may lag earnings growth due to moderation in valuation multiples.
  • Macro View: In our view, macro environment remains challenging with heightened global geo-political and economic uncertainties. Recent banking issues in US and EU highlight fragility in the system and therefore despite inflation remaining on the higher side, US bond yields reflect risk of a recession in the next 12 months. For India, strong infrastructure thrust of the government as announced in the Union Budget with more than 20 per cent (YoY) growth in capital spending remains a key support for the domestic economy. Inflationary pressures seem to be moderating with correction in crude and global commodity prices and likelihood of further interest rates increases has reduced. Monsoon will be a key factor to watch for India in the near term.
  • Outlook: We believe lagged impact of sharp interest rate increase cycle could result in negative growth surprises for the global economy going forward. On the positive side, likelihood of further interest rate increases seems to have diminished. Decline in crude and other global commodity prices is another clear positive for India. We believe Indian government’s thrust on infrastructure and support to manufacturing remains a strong medium-term driver of growth. While we expect India’s economic growth to be slower in FY24 and expect downside to consensus earnings growth forecast, we remain positively biased towards domestic cyclicals and constructive on Indian equities longer term supported by the more robust medium term growth outlook.

Key drivers for future

On the headwinds, we have

  • High and persistent inflation concerns (Global & Domestic)
  • US Fed Policy: Accelerated rate hikes and balance sheet shrinking process could mean volatile equities.
  • Moderating global and domestic growth due to demand impact from sticky inflation. Higher interest rates are likely to weigh on consumption going forward.

We see the following positives for the Indian market:

  • Robust domestic macro: Strong government thrust on infrastructure and manufacturing. Urban demand should continue to improve with recovery in service economy.
  • Moderating commodity prices: Reversal in commodity prices (especially crude oil and fertilizers) is a positive from inflation, fiscal deficit and corporate margins perspective.
  • Other factors / risks: High current account and fiscal deficit.

* Returns mentioned in the report are the Total Return or TR variants of the respective domestic indices. USD return for global indices. (Source: Bloomberg, MOSL & HSBC MF estimates as on April 2023 end).

Disclaimer: This document has been prepared by HSBC Asset Management (India) Private Limited (HSBC) for information purposes only and should not be construed as i) an offer or recommendation to buy or sell securities, commodities, currencies or other investments referred to herein; or ii) an offer to sell or a solicitation or an offer for purchase of any of the funds of HSBC Mutual Fund; or iii) an investment research or investment advice. It does not have regard to specific investment objectives, financial situation and the particular needs of any specific person who may receive this document. Investors should seek personal and independent advice regarding the appropriateness of investing in any of the funds, securities, other investment or investment strategies that may have been discussed or referred herein and should understand that the views regarding future prospects may or may not be realized. In no event shall HSBC Mutual Fund/HSBC Asset management (India) Private Limited and / or its affiliates or any of their directors, trustees, officers and employees be liable for any direct, indirect, special, incidental or consequential damages arising out of the use of information / opinion herein. This document is intended only for those who access it from within India and approved for distribution in Indian jurisdiction only. Distribution of this document to anyone (including investors, prospective investors or distributors) who are located outside India or foreign nationals residing in India, is strictly prohibited. Neither this document nor the units of HSBC Mutual Fund have been registered under Securities law/Regulations in any foreign jurisdiction. The distribution of this document in certain jurisdictions may be unlawful or restricted or totally prohibited and accordingly, persons who come into possession of this document are required to inform themselves about, and to observe, any such restrictions. If any person chooses to access this document from a jurisdiction other than India, then such person do so at his/her own risk and HSBC and its group companies will not be liable for any breach of local law or regulation that such person commits as a result of doing so.

© Copyright. HSBC Asset Management (India) Private Limited 2023, ALL RIGHTS RESERVED.

HSBC Mutual Fund, 9-11th Floor, NESCO - IT Park Bldg. 3, Nesco Complex, Western Express Highway, Goregaon East, Mumbai 400063. Maharashtra.

GST - 27AABCH0007N1ZS | Email: | Website:

Mutual fund investments are subject to market risks, read all scheme related documents carefully

Debt Market Review

  • The month of April saw some amount of stability in global markets. US CPI inflation moderated to 5.0 per cent in March 2023 vs 6.0 per cent in the previous month. Core CPI, however, continues to remain sticky at 5.6 per cent.
  • On the domestic macro front, CPI inflation moderated to 5.66 per cent in March 2023 (vs 6.44 per cent in Feb) given moderation in food prices and decline in core inflation to 5.8 per cent. WPI inflation declined to a 29-month low of 1.34 per cent in March 2023 (vs 3.85 per cent in Feb).

Read more