The BSE Sensex has rallied 12,026.03 points or 16.64 percent so far in 2024, giving investors handsome returns. The benchmark scaled its all-time high of 85,978.25 on September 27 this year, breaching several milestones.
Analysts attributed the sharp rally in the markets to robust domestic liquidity coupled with strong fundamentals of the Indian economy.
“One of the key features this year has been strong domestic liquidity, driven by record inflows in the mutual fund industry,” said Santosh Meena, head of research at Swastik Investsmart Ltd.
Despite selling pressure from FIIs (foreign institutional investors), Indian equity markets posted solid gains to record highs, he said.
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“Notably, midcap and smallcap indices performed well and many stocks turned into multibaggers, giving retail investors very good returns,” Meena added.
At the start of the year, the BSE Sensex was at 72,271.94 and the benchmark gauge is now at 84,266.29.
Overall, 2024 has been an excellent year for retail investors, particularly in midcaps and smallcaps, marked by strong market performance, supported by local liquidity and resilience against FII outflows, he said.
The BSE midcap gauge is up 12,645.24 points or 34.32 percent so far this year, while the smallcap index is up 14,777.09 points or 34.62 percent.
“The sharp rally in recent weeks was a result of the Fed rate cut and hopefully the RBI will follow suit in its policy meeting,” said Prashant Taapse, senior VP (research) at Mehta Equity Ltd.
The 30-share BSE benchmark ended above the 83,000-level for the first time on September 17. It finished above the historic 84,000 level for the first time on September 20. The benchmark ended above the 85,000-level on September 25.
“Global markets, despite ongoing geopolitical tensions, have also been supportive. A significant positive trigger for emerging markets like India is the start of the interest rate cut cycle in the US.
“This has boosted investor sentiment and liquidity flows into riskier assets. Further, despite geopolitical uncertainties, crude oil prices remained relatively low throughout the year, providing further support to the Indian economy by easing inflationary pressures and improving the market outlook, ” Meena added.
In 2023, the BSE benchmark rose 11,399.52 points or 18.73 percent.
Dalal Street Investors in 2023 will increase their assets by Rs. 81.90 lakh crore was added.
The combined market valuation of all listed companies on the leading stock exchange BSE reached the USD 4-trillion milestone for the first time on November 29 last year.
The market capitalization of BSE-listed companies crossed the USD 5-trillion mark on May 21 this year.
Reliance Industries Rs. It is the most valuable company in the country with a market valuation of Rs 19,82,265.88 crore, followed by TCS (Rs 15,50,820.85 crore), HDFC Bank (Rs 13,16,818.45 crore), Bharti Airtel (Rs 9,652,747 crore). Rounding out the top five is ICICI Bank (Rs. 8,98,320.22 crore).
On the road ahead for equity markets, Meena said, “As we approach the US elections and navigate the current geopolitical uncertainties, the market may experience timing and price corrections in certain segments. However, sectors and Stock-specific opportunities will continue to be driven by the strength of domestic liquidity.”
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