On December 11, 2023, Sensex touched the 70,000 level, although it closed a bit lower by the end of the day. It is anticipated that the index will soon surpass this mark and might even reach 1,00,000. Much has transpired in the last three years.
If we look at history, the Nifty has shown an annual growth of 12% over the last 20 years, currently trading above 20,000.
Now, you might be witnessing the market and the economy accelerating post-COVID-19. But what is the reason behind this?
Let’s understand!
What’s Happening?
Indian retail investors are flocking to the market through the Systematic Investment Plan (SIP) route. The Reserve Bank has contained inflation, and as of January 2020, the MSCI World Index has risen from 9% to 15.68%. So far, India stands out as one of the most talked-about and emerging markets globally.
With India’s growing economy and market, it seems that the day is not far when India will be called the golden sparrow again.
Reasons for Growth in the Indian Stock Market
PMI Indicator: It indicates a robust economy as India’s Composite PMI has never fallen below 50, unlike various other struggling economies globally.
GST Collection: Monthly GST collection in India is consistently above 1.5 lakh crores.
Foreign Exchange Reserves: Despite pressure on the rupee, India has maintained around 600 billion dollars in foreign exchange reserves.
Retail Investors: In recent years, the participation of retail investors in the Indian stock market has been rapidly increasing, playing a significant role in the market’s growth.
FII Flow: India remains the favourite market for Foreign Institutional Investors (FIIs) as they have shown the most interest compared to other economies.
What’s Next?
According to CNBC, as per the data from the World Federation of Exchanges, the Indian stock market has become the seventh-largest in the world. Due to increasing hope in India’s economic prospects, confidence in the market is growing. By the end of November, the total market capitalisation of the National Stock Exchange of India was $3.989 trillion, surpassing Hong Kong’s $3.984 trillion.
That’s it for today. We hope you’ve found this article informative. Remember to spread the word among your friends. Until we meet again, stay curious!
*The article is for information purposes only. This is not an investment advice.
*Disclaimer: https://tejimandi.com/disclaimer
