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Banking Funds Outperform

Banking stocks ended the week with a bang but Gold ETFs turned out to be the worst performers

There was a sigh of relief on Dalal Street with the bulls coming out in hordes on Friday. For the week ended April 25, the Sensex gained 3.91% and the Nifty 3.09%. The market shrugged off negative sentiments, like rising inflation and average to below-average results; and defying all odds the Sensex surpassed the psychological level of 17,000 and 5,000 level for the Nifty.

The banking funds category gained the most this week with a category average of 5.03%. However, it was lower than the BSE Bankex index gain of 6.9%. For the one-year period ended on April 25, the banking category too topped the chart with 37.13%. Ironically, the Gold ETF category followed with a gain of 24.68% making it the second-best one-year performer but the worst performer for the week.

Coming back to the week's performance, tax-saving funds followed the banking category's average with a return of 2.79%. In the Equity: Index category, Banking BeES gained 6.28 per cent, followed by 4.54 per cent of Nifty Junior BeEs. The best funds were LICMF Tax Plan (4.48%), Franklin India Taxshield (4.06%) and Principal Tax Savings (4.04%).

Diversified equity funds followed closely behind the tax-saving funds with a category average of 2.77%. In the equity diversified category, the best performers were ICICI Prudential Infrastructure (4.84%), Franklin India Flexi cap (4.80%) and Taurus Starshare (4.63%).

The main highlight of the week was the announcement of much-awaited real estate mutual fund guidelines. SEBI has given a go-ahead to existing mutual funds and new mutual funds for launching real estate branded schemes Guidelines on Real Estate MFs.

On Monday, the RBI will announce the annual monetary policy. Taking the cue from RBI Governor - Mr. Y.V. Reddy's assessment of the economy, the markets will then decide whether to swing with the bulls or with the bears.