At 01:47 pm; the S&P BSE FMCG index, the largest gainer among sectoral indices, was up 2.1% as compared to 0.45% rise in the S&P BSE Sensex.
In past two weeks, the FMCG index has outperformed the market by surging 7% after private forecaster Skymet said monsoon in India is likely to be normal with no chances of drought this year. On comparison, the benchmark index was up 5% during the same period.
The Indian Meteorological Department’s (IMD) has also predicted southwest monsoon (April-September) to be at 97% of the long period average (LPA) with a margin of error of +/- 5%.
ITC, Godrej Consumer Products and Dabur were up more than 3% today. Hindustan Unilever, Nestle India, Gujarat Ambuja Exports and Godrej Consumer Products from the FMCG index hit their respective record highs on the BSE.
A normal monsoon is expected to benefit the overall economy and to support rural consumption. The rating agency CRISIL said a normal monsoon is crucial to push economic growth, which slowed last year under the lingering impact of demonetisation and disruptions due to implementation of the goods and services tax (GST), both of which impacted private consumption demand as well as exports.