Optimistic Outlook: Indian Stock Market Projected to Surge in 2024

Indian Stock Market Projected to Surge in 2024

VoM News Desk | February 22, 2024 | 10:29 AM IST | India | Follow on Google News

Optimistic Outlook: Indian Stock Market Projected to Surge in 2024/Reuters

Optimistic Outlook: Indian Stock Market Projected to Surge in 2024

Despite already high valuations, analysts polled by Reuters expect the Indian stock market to surge to new highs by the end of June and gain nearly 9% in 2024. The BSE Sensex index, buoyed by positive economic indicators and political stability expectations, is anticipated to reach 76,000 by the end of June and 78,550 by the close of 2024, reflecting a 4% increase in the short term and a 9% gain for the entire year.

Factors Driving Bullish Sentiment

The optimism in the stock market is attributed to expectations of global central banks cutting interest rates in 2024, India’s economic growth outpacing its peers, and the anticipation that the ruling Bharatiya Janata Party, led by Prime Minister Narendra Modi, will retain power in the upcoming national election. India’s robust economic performance, growing around 7% this fiscal year, contributes to the positive outlook.

Challenges and Concerns: Valuations and Potential Correction

While the stock market is perceived as constructive with the current macroeconomic situation and policy continuity expectations, concerns about high valuations persist. With a price-to-earnings ratio of 24, above the long-term average of 20, further increases may raise valuation apprehensions. Nevertheless, the majority of respondents in the poll (60%) deem a market correction in the next three months as unlikely.

Economic Growth and Corporate Earnings

The Indian economy’s resilience, anticipated to continue its growth momentum in 2024, contributes to the bullish sentiment. Additionally, the poll indicates confidence in corporate earnings, with all but one of the respondents expecting an increase over the next six months. The overall positive outlook positions India as a stable and attractive market amidst global economic volatility.

VoM News Desk

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