FMCG sector's defensive cloak feels tear of forces in stock market

The sector's stocks fail to shield portfolios in current market selloff

The fast-moving consumer goods (FMCG) sector is losing its status as a defensive sector. Historically, FMCG stocks have outperformed in a falling market, providing downside protection to portfolios. However, during the current market selloff, the FMCG index has underperformed the broader market. The National Stock Exchange (NSE) Nifty FMCG Index is down 13.6 per cent since the end of September, when the equity market peaked, compared to a 8.7 per cent decline in the benchmark NSE Nifty 50 during the same period.

 

The FMCG sector has continued to lag for the second consecutive month in November. The sectoral index is