Market outlook for Samvat 2080: Indian stock market on a good wicket; positives outweigh potential negatives

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World Cup or on the global macroeconomic stage. If one were to think of the global events that have unfolded over the last one year, one would have anticipated a reasonable correction in the equity market. However, India’s policy stance ensured that global geopolitical tensions didn’t impact India materially.

Despite the negative economic news flow from the global markets, the stable corporate earnings cycle and reasonable domestic equity flows led to positive returns in the Indian markets. The K-shaped recovery trend post covid continued over the past year. Consumption at lower income segments continued to be relatively subdued.

Central banks across the globe, including the RBI, were forced to raise policy rates to tackle raging inflation. Unlike past rate hiking cycles, there were no extreme reactions following the rate hikes. India’s prudent monetary policy post covid minimised the need for massive rate hikes.

Rangebound interest rates ensured that the growth momentum was not disrupted. BSE Sensex recorded a return of 7 per cent over the past one year. Muted returns amid steady earnings growth led to a marginal correction in valuations in the large-cap bucket over the past year.

Meanwhile, BSE Midcap and BSE Smallcap indices staged a remarkable performance delivering 28 per cent and 33 per cent respectively. The outperformance was driven by robust flows into these categories, likely following their strong recent performance. Also Read: Diwali 2023: Can Nifty 50 hit 25,000, Sensex touch 75,000 in Samvat 2080? Here's what experts say Share of combined flows into midcap and smallcap categories over the past year stood at nearly 43 per cent versus nearly 28 per cent over the past three years.