Stock market: Nifty fell in six of last 10 Februarys. What's ahead? Keep an eye on these F&O shares

Stock market indices Sensex and Nifty have fallen nearly 3 per cent in January, and if one were to go by analysts, more than any sops, investors would be focusing on the FM Nirmala Sitharaman's signals on fiscal consolidation and capex spending in forthcoming interim Budget on February 1. Besides, they would be wishing for no changes to long-term capital gains (LTCG) on equities.

History suggests February has been a mixed month for stocks, with Nifty falling in six Februarys out of last 10 occasions. The average fall for the month stands at 1 per cent, JM Financial said in a note. In the case of Nifty Midcap index, the index has settled lower in February, in seven out of last 10 occasions. The average decline for the Nifty Midcap index in last 10 Februarys stood at 0.7 per cent. That said, the Nifty Midcap index outperformed Nifty in five occasions with an average outperformance of 0.3 per cent, JM Financial said.

Sector-wise, none of the sectoral index closed in the green for 7 or more occasions. The worst performer has been FMCG, which has fallen in Februarys in eight of last 10 years. Media, Energy and Bank indices settled lower in seven Februarys with an average return of 3.1 per cent, 1.4 per cent and 0.8 per cent. Among sectors, NSE IT outperformed Nifty in eight occasions, with an average outperformance of 1.1 per cent.

F&O stocks

JM Financial said F&O stocks such as Cholamandalam Investment and Finance Company Ltd , Voltas Ltd, Polycab India and Persistent Systems have higher exhibited a stronger seasonality in February. It said the four shares closed in the green with probability of 70 per cent, with an average return of 4 per cent, as suggested by historical data.

Canara Bank, Bharat Heavy Electrical Ltd (BHEL), Hero MotoCorp, SAIL, Maruti Suzuki and Crompton Greaves Electrical closed in the red with a probability of 80 per cent, with history suggesting an average negative return of over 4 per cent for the stocks, JM Financial said.

Disclaimer: Business Today provides stock market news for informational purposes only and should not be construed as investment advice. Readers are encouraged to consult with a qualified financial advisor before making any investment decisions.

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