Nifty 50 posts its strongest December in 20 years; a look at best-performing stocks in 2023
Also Read: Top 4 sectors to watch out for in 2024 for better returns Nifty 50 has notched several record highs this year, surpassing 19,000 in June and reaching 20,000 and 21,500 levels in September and December, respectively. On December 28, the index touched a record high of 21,801 points, and it finished the final trade (Friday) of 2023 at 21,731 points, gaining 3,626 points, or 20.03%.
Robust retail participation and strong FPI inflows: The market rally was propelled by significant retail participation and sustained foreign portfolio investor (FPI) inflows, bolstered by improved global sentiment and strong domestic economic growth. Recent reports indicate FPIs purchased ₹604.78 billion worth of Indian equities as of December 28, marking one of the highest monthly foreign inflows in three years.
Global factors: The decision by the US Federal Reserve to pause its rate hike trajectory and signal potential rate cuts in 2024 has significantly boosted investors' confidence. This led to a shift in investor preference from bonds to equities.
Further, the drop in key commodities such as crude oil prices further contributed to the market's buoyancy. Also Read: Outlook 2024: Valuations, earnings, pre-election optimism to fuel Indian stock market, says Standard Chartered Domestic catalysts: On the domestic front, the victory of the Bharatiya Janata Party (BJP) in three key state elections signaled the potential return of the NDA in the 2024 general elections.
Moreover, healthy corporate earnings, a pause in rate hikes by the Indian central bank, and the country's robust economic growth of 7.6% in the September quarter have also lifted investors' sentiment. The strong expansion in Q2FY24 has prompted the Reserve Bank of India
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