Bijetri Roy, Managing Director & Chief Strategy Officer, InsPIRE
SENSEX closed at 60,048.47 on 24th September, 2021, ear-marking a high in the graphs, since the last milestone of 50,255.75 on 3rd February, 2021. In fact, even the BSE Realty and NIFTY IT indices closed at their respective highs of 4002.46 and 37,103.25.
This is a clear indication that India is still the flavour of the season, despite a probable slowdown in China or smaller bond purchase by central banks.
Earlier this week, Sanjeev Prasad, Kotak Institutional Equities said, “We expect a strong economic and earnings revival and a stable COVID-19 situation to provide short-term support to the market. We do not see any change to India’s medium-term narratives, including favourable demographics and likely multi-year investment cycle led by corporate and household capital expenditure.” (Source: Financial Express)
In the last four seasons, Domestic Institutional Investors (DIIs) invested in shares worth USD 1 billion, while Foreign Portfolio Investors (FPIs) invested in Indian equity worth USD 9 billion. (Source: Financial Express)
According to Piyush Garg, Chief Investment Officer at ICICI Securities Ltd, “Indian stocks have been performing well over the past few quarters due to robust liquidty, upward earnings cucle and an economic revival led by a fading pandemic. (Source: Mint Lounge)
“SENSEX reaching 60,000 shows India’s growth potential and its emergence as a world leader, amid Covid”, Ashish Chauhan, MD & CEO, BSE.
However, looking at the global markets at present, investors should be cautious of the following:
- Rising inflation
- Subsequent squeeze in liquidity
Overall, India is definitely the flavour of the season, having hit the “bull’s” eye with the 60K milestone.