Despite it being seen to be relatively less unstable in the past few weeks, domestic equity market benchmark S&P CNX Nifty index has been able to outperform most, but not all, significant emerging and developed market indices.

Equity markets, worldwide, have been swinging in recent months, up initially but mostly down afterwards. Nifty’s corelation, a FCRB research reveals, during this time has been the strongest with the US’ equity benchmark index, S&P 500. The Indian equity benchmark has also been able to provide among the least un-rewarding returns to short-term global equity investors in recent months, the analysis further brings out.

In July, for instance, Nifty gave a month-on-month return, based on average of daily closing values in a month, of 2.27 per cent, trailing behind only South Korea’s Kospi index and US’ S&P 500, out of six significant global equity market indices analysed (see table). In the next two months, when the global markets started sliding on account of adverse economic news and enhanced uncertainties, Nifty’s outperformance has improved to being the second least worst performer among its peers in emerging and developed markets.

Last month when markets were hit the most, Germany’s equity benchmark index, Dax, fell the most among the seven indices analysed (by 18.77 per cent on a month-on-month basis). That the European continent was getting hit the most was reflected in the second worst performer, the MSCI Emerging Markets Eastern Europe (MSCI EM EE) index, which returned a negative 14.72 per cent.

The least fall, last month, took place in Hong Kong’s Hang Seng index, which fell 8.74 per cent, and Indian Nifty was the next least-worst performer, with a negative 9.28 per cent.

India’s closest emerging market peer in equity indices, Brazilian Bovespa, has, in the current month, for the first time, in recent months, outperformed all the six other indices, including Nifty, It is up by 5.14 per cent on a month-on-month basis in the current month (till 9 September) while the rest have fallen -- with Nifty recording the lowest fall with a marginal decline of 0.01 per cent.

However, over the entire period of three months, Nifty has managed to provide the least-ruffled marketplace for global equity investors. From its average closing of 5,472 in June to 5,076 in the current month, Nifty has given a negative return of 7.23 per cent, the lowest among all the analysed indices. Interestingly, S&P 500 of the US has given the second-lowest negative return of 8.30 per cent, followed by Brazilian Bovespa’s negative return of 9.13 per cent, making the Indian, US and Brazilian equity benchmarks co-relate the most with each other over the past three months.

The farthest away, and the most badly affected equity market benchmarks, from June to the current month, has been German Dax and European MSCI EM EE indices with respective negative returns of 24.74 per cent and 17.05 per cent. In the middle, but closer to Brazil-India-US’ performance, have been the Asian indices of Hang Seng and Kospi with negative returns of 10.51 per cent and 11.90 per cent respectively.