The Nifty Smallcap 250 gained 4.20%, outperforming the Sensex's 2.53% rise
FinTech BizNews Service
Mumbai, July 10, 2026: Bajaj Asset Management Limited has come out with a special report on the debt and equity outlook titled “The Macroscope”.
Report highlights:
Macroeconomy: Sticky inflation, mixed global returns as India outperforms
Global inflation has turned stickier, with price pressures resurfacing across the US and Eurozone, while India also saw an uptick. Central banks largely retained a cautious policy stance, though China remained accommodative. Global equity markets delivered mixed one-month returns as AI-led optimism faded, with Hong Kong's Hang Seng falling 9.14% and Japan's Nikkei gaining 5.63%. India's Nifty 50 rose 1.35%, supported by resilient domestic fundamentals and improving investor sentiment.
FIIs vs DIIs: Domestic institutions continue to cushion FPI volatility
Foreign portfolio investor (FPI) flows remained volatile over the past year, alternating between inflows and sharp outflows, including heavy selling in March 2026. Domestic institutional investors (DIIs) consistently absorbed this selling, providing sustained support to equities. In June 2026, FPIs were net sellers of US$3.05 billion, while DIIs invested US$8.30 billion, extending the trend of domestic money offsetting foreign withdrawals.
Stock market: Broader markets lead June equity rally
Indian equities extended gains in June, with broader indices outperforming benchmark indices as easing geopolitical tensions, softer crude prices and resilient macroeconomic data improved sentiment. The Nifty Smallcap 250 gained 4.20%, outperforming the Sensex's 2.53% rise. Private banks, banks and realty led sectoral gains on expectations of stronger credit growth and lower funding costs, while IT and metals underperformed amid weaker global demand and fading AI-driven optimism.
Fixed income: Liquidity support underpins debt market stability
Debt markets remained supported despite temporary liquidity tightening caused by GST collections and advance tax outflows. The RBI injected liquidity through Variable Repo Rate auctions, while month-end government spending restored surplus liquidity. Headline inflation rose to 3.93% in May from 3.48% in April, driven mainly by food inflation, while core inflation remained contained, helping preserve a relatively favourable backdrop for bonds.
