The benchmark index is up more than 1% this year, surpassing the 73,000 mark for the first time in January.
Bengaluru:
The stock market will hit new highs by the end of June and gain about 9% in 2024, despite already lofty valuations, according to analysts polled by Reuters, who said a recovery in the next three months is unlikely. Is.
The BSE Sensex index, which closely tracks the US S&P 500 index, rose nearly 19% last year on hopes that global central banks will cut interest rates in 2024 and that India’s economic growth will outpace its peers.
The benchmark index is up more than 1% this year, surpassing the 73,000 mark for the first time in January.
This is despite speculation of an initial rate cut by the US Federal Reserve having faded, leading to foreign portfolio outflows from many emerging markets.
Optimism in the stock market is also driven by hopes that the ruling Bharatiya Janata Party led by Prime Minister Narendra Modi will retain power in the upcoming national elections.
A February 12-21 Reuters survey of 28 equity analysts forecast the Sensex index would rise 4% to a high of 76,000 at the end of June, well above the 70,000 level expected in a November survey.
From Tuesday’s close of 73,057, the BSE index is projected to rise 7.5% to 78,550 by the end of 2024. This would be an increase of approximately 9% for the full year.
Neeraj Chadawar said, “The Indian economy remains a ‘star performer’ relative to other emerging markets. Furthermore, we strongly believe that it will continue its growth momentum in 2024 and maintain stability against the backdrop of a volatile global economy. The land will remain.” Head of Quantitative Equity Research at Axis Securities.
“The overall setup is very constructive for the market at this level as the market is focusing on policy continuity in the upcoming national level elections.”
India, the fastest growing major economy, is expected to grow about 7% this fiscal year and more than 6% over the next few years.
All but one of the 26 respondents to an additional question said corporate earnings would increase in the coming six months.
When asked about the likelihood of a market correction in the coming three months, a nearly 60% majority of respondents, 16 of 27, said it was unlikely, including two who said it was extremely unlikely. Nine said probable and two said extremely probable.
“It’s very difficult to say whether there has been a major correction or not. But right now I think India is in a good macro position and the concerns are more about slightly elevated valuations than anything else,” said Rajat Aggarwal, Asia equity strategist. There are more.” In Societe Generale.
At a price-to-earnings ratio of 24, the BSE index is trading above its long-term average of 20, suggesting that any further rise will only increase concerns around valuations.
The survey forecast the Nifty 50 index to rise more than 2% on Tuesday to 22,750 at the end of June and 23,925 at the end of 2024.
