ETF Market Recovers With Equity Market; Over ₹35,000 Crore Worth Trades 

Mumbai, April 6: The Indian ETF market on Monday showed strong participation as it rallied with equity markets. Turnover continued to remain high across equity, commodity and debt ETFs as domestic institutional investors (DIIs) as well as retail investors traded heavily in a volatile session. Turnover was led by few large-volume big-movers capturing the steep intraday recovery, as hopes of a ceasefire in the Middle East spurted up risk-taking sentiment across asset classes. 

Across categories, ETFs tracking equity indices, gold and silver prices emerged as favourites among traders, with silver ETFs being among the top gainers of the day while banking ETFs tracked sharp gains in the underlying Sensex and Nifty indices. Gold ETFs continued their upward march today even as MCX gold futures fell amid correction in domestic gold prices.

Top 7 ETF Gainers

PSUBANK ETF led the pack in terms of absolute points gained. It jumped ₹25.59 to ₹830.05, tracking Nifty PSU Bank index (+2.46%) as investors piled into PSU bank ETF on bargain-buying. BANKETF added ₹11.51 to ₹535 while BANKBEES rose ₹10.52 to ₹543, tracking the strong performance of Bank Nifty (+2.01%) on heavy buying in Axis Bank, Bank of Baroda and Canara Bank. SENSEXBEES gained ₹10.45 to ₹847.57 while JUNIORBEES (+2.28%) – ETF that tracks Nifty Next 50 index ended higher at ₹677.03 on strong upmove in Adani Green (+7.94%) and Bank of Baroda (+4.38%) stocks that led gains in that index. EQUAL50 ETF which tracks equal weighted Nifty 50 basket rose ₹8.12 to ₹306.61 outperforming market cap-weighted ETFs as mid-cap weight stocks in Nifty outperformed larger-caps. Finally, SBISENSEX added ₹7.78 to ₹819.49 tracking strong inflows into the Sensex ETF of SBI fund house.

What Pushed Markets: Ceasefire Talks

News that emerged during the day that US, Iran and mediator countries are talking about a 45-day ceasefire deal in hopes of pushing for a permanent agreement gave overnight gains a strong push during Monday’s session. According to report by Axios, mediator countries are pitching a two-step ceasefire where phase one would see fighting come to a halt alongside start of peace-talks. Reuters hasn’t verified this report independently and White House has denied comments on the development. Nonetheless, markets cheered the development leading to fall in geopolitical risk premium.

Gold ETFs Gain; Silver ETFs Rally Despite Flat Spot Price

SILVERBEES rallied ₹6.36 to ₹222.36 while SILVERIETF advanced ₹6.24 to ₹231.83, making them among the top commodity ETF performers on the day even as silver price stayed flat at ₹2,500 per 10 grams in all reporting cities after correcting last week. GOLDBEES increased ₹2.18 to ₹122.78 while GOLDIETF climbed ₹2.67 to ₹127.19 despite fall in spot gold price domestic India. Spot gold in India declined ₹180 to ₹14,913 per gram for 24K today as against previous close of ₹15,093 — seeing profit booking coming in after sharp rally last week. Analysts pointed out that normally in such geopolitical crisis environment gold and silver would have seen strong rallies as investors choose safety over everything else. “While there is no denial of the fact that gold and silver are safe-havens during geopolitical tensions, what we are seeing currently is profiting by traders after sharp rally in metals last week due to war fears,” a derivatives analyst at a domestic brokerage said.

Top 5 ETF Losers

The biggest loser among ETFs on Monday was MOSILVER as it declined ₹5.99 to ₹229.59 on heavy redemption pressure. This is surprising given the broader trend in silver ETFs which moved up on the day. LOWVOL ETF lost ₹3.14 to ₹190.25 as low volatility ETF underperformed on a day when investors favoured cyclical sectors over defensives. MOQUALITY ETF also lost ground by ₹1.53 to ₹185.27 for similar reasons as low-beta and quality-factor ETFs failed to participate in a strong recovery led by investor sentiment rather than fresh buyers. HEALTHIETF dropped ₹1.14 to ₹143.02 as despite a marginal gain in Nifty Pharma index, investor sentiment failed to pick up for healthcare ETFs. OILIETF slipped marginally by ₹0.11 to ₹10.88 tracking weakness in Nifty Oil & Gas (-1.36%) as crude prices slipped amid ceasefire hopes. 

Source: https://www.bseindia.com/markets/etf/ETF_MktWatch.aspx