Holi 2923: Sensex up 4% in last one year, Nifty up 2.5%

looking at the Indian market Performance since Holi 2022, both Sensex and Nifty 50 have made some notable gains.

Since the date of Holi 2022, the Sensex has gained a whopping 2,360.53 points or 4.07%. On the other hand, smelly50 has gained 424.4 points or 2.45%. Last year, the festival of Holi was celebrated on 18 March. On that day, on March 17, 2022, the Sensex was around 57,863.93 and the Nifty 50 was at 17287.05.

The backdrop of the last three months of FY22 was significant. the world was in its infancy macroeconomic Uncertainties, geopolitical tensions between Russia and Ukraine, global supply-chain disruptions, the policy rate hike cycle, inflationary pressures, highly volatile conditions, and more.

Economic setup in FY23

It has been a seesaw ride for the markets so far in FY23!

Meanwhile, the first half of FY23 struggled to cope with the risks as inflationary pressures acted as major spoilers for monetary tightening and aggressive rate hikes from central banks globally. The second half has so far seen the global economy in a recovery phase, with tailwind risks still looming, however, with India growing majorly and outperforming. emerging markets,

In the early days of December 2022, the Sensex touched a new lifetime high of 63,583.07 and the Nifty 50 touched a historic high of 18,887.60.

But the beginning of the year 2023 was full of ups and downs. In its February 2023 bulletin, the RBI said, “After being range bound in the first half

Jan 2023 Domestic equity markets initially moved higher in the second half, tracking losses unexpected tax on crude oil. Sentiment turned negative at the end of the month, following unusual price movements in the shares of a trading group.”

Indian equities are still at a premium even as investors started booking profits due to overvaluation.

According to Mark Matthews, Head Research Asia, Julius Baer Data, over the past four months, India’s valuation premium vs. emerging market (EM) counterparts rebounded sharply from a high of 120% in November 2022 to their 10-year average of 70% as Chinese markets rallied more than 50% during the same period.

Furthermore, Mathews points out that direct retail ownership declined from an all-time high of 9.8% in March 2022 to 9.2% in December 2022 due to slowing growth in account openings, falling share of retail in cash turnover, and muted growth. market performance.

Further, ownership by domestic institutional investors (DIIs) remained at a record high quarter-on-quarter and increased from 12.1% in March 2022 to 13.7% in December 2022. Foreign Institutional Investors (FII) ownership has also increased by 50 bps. From the decade low of 18.4% in June 2022 to 18.9% in December 2022.

Contribution from March 2022 systematic investment plans (SIP) has reached a record high of 13,856 crore in January 2023. Last year in the month of March, SIP contribution was 12,328 crores.

Also, the number of outstanding SIP accounts has increased to 62.16 million between April and January 2023 as compared to 52.73 million as on March 31, 2022.

property under the management of mutual fund industry has grown to 39,62,405.52 crore as compared to the level of Rs. 37,56,682.57 crore by March 2022.

Further, in January this year, the Indian equity market completed its transition to a faster settlement mechanism for T+1 settlement with all securities in the equity segment.

“This marks the culmination of a process that began in September 2021, making India one of the global leaders with the shortest settlement cycle which has been instrumental in mitigating settlement, counterparty and operational risks,” RBI said in its bulletin. Will help and also have a positive impact on trading volumes.”

Maintaining an overweight stance on India, Mathews sees the Sensex climbing to a new record high of 70,000 which would be a 16% upside from current levels.

For the year 2023, ICICI Direct has set a target of 21,500 and 71,600 for the Sensex – offering a decent potential growth.

Let us see if this Sensex and Nifty 50 trajectory can become a reality by the next Holi.

Disclaimer: The views and recommendations given above are of individual analysts or broking companies and not of Mint. We advise investors to do due diligence with certified experts before making any investment decision.