Five things that might push the Nifty 50 to a record high in December
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| Five things that might push the Nifty 50 to a record high in December |
State election outcomes, US interest rate trends, and geopolitical concerns are the main variables that analysts believe may impact the market in December.
The Nifty 50 index is gradually approaching its all-time high of $20,222.45, which was attained during intraday trading on September 15 of this year. On Thursday, November 30, the Nifty 50 reached a high of 20,136.15 during morning trading. Around 11:20 am, however, it lost all of its gains and saw a roughly 30-point decline in value.
Analysts are upbeat about the market because they see robust economic development opportunities for the nation. Furthermore, after a two-month hiatus, foreign portfolio investors (FPIs) have started purchasing Indian stocks again. FPIs have purchased ₹4,687 crore worth of Indian stocks so far in November, according to NSDL statistics.
The outcome of state elections, US interest rate trends, and geopolitical concerns are some of the major variables that may influence the market in December.
According to Deepak Jasani, head of retail, "There are some of the factors that could keep Nifty in December are beneficial developments in both of these geopolitical conflicts, an increasing belief that the top of the rate hike cycle domestically is behind us, and favorable results of state elections." able to be pursued." HDFC Securities Research.
Here are five elements that may cause the Nifty 50 to reach all-time highs in December.
1. Results of State Elections
Analysts think that the outcome of state elections may have an impact on the mood of the market. The significance of these state elections lies in its potential to influence the key Lok Sabha or federal elections in 2024.
Right present, the BJP controls Madhya Pradesh, while the Congress is in charge of Rajasthan and Chhattisgarh. Mizoram's Chief Minister is Zoramthanga of MNF, whereas Telangana's Chief Minister is K Chandrasekhar Rao of BRS.
The results of the Assembly Elections 2023 exit polls are expected to be announced on Thursday, November 30, around 6:30 p.m.
2. The Fed may decrease rates
Even while it seems that the market will not accept a rate cut in May or June of next year, a strong signal on this front from the US Federal Reserve would improve market sentiment.
Bloomberg reports that billionaire investor Bill Ackman thinks the US Federal Reserve will begin reducing interest rates earlier than the market anticipates. In March 2022, the Fed will start hiking rates at their quickest rate in forty years.
To make decisions on monetary policy, the US Federal Open Market Committee (FOMC) will convene on December 12–13.
3. Comfort level assessment in big caps
Large-cap stocks still enjoy some comfort with their values, but the mid- and small-cap sectors have had sharp increases that have driven up their valuations. Experts in the market predict that capital will flow from small- and mid-cap to large-cap sectors. The Nifty 50 may reach a record high in December as a result.
4. Improvements in the geopolitical sphere
Since last year, investors have been uneasy due to geopolitical worries. As long as the Israel-Hamas truce is in place, the conflict between Russia and Ukraine will not end.
Moments before the agreement came to an end on Thursday, Israel and Hamas said that the truce would remain in place, despite the lack of clarity around any formal agreement. This was reported by AFP.
The tone of the market will be affected by positive geopolitical events, which might drive the benchmark to all-time highs.
5. Better than predicted macronumbers
India's economy continues to be among the world's largest economies with the greatest rate of growth. Although solid growth is anticipated in India's macrodata, if results exceed expectations, this might spark significant buying activity in the market from both local and foreign institutional investors.
