New Delhi: Wednesday witnessed a bullish trend as both benchmark indices reached new record highs. The BSE Sensex surged over 500 points, surpassing the milestone of 64,000, while the NSE Nifty, comprising 50 shares, also achieved a record level above 19,000.
The Nifty broke its previous record of 18,887.60, set on December 1 of the previous year. The rally of the Nifty, which has surged nearly 12% in the last three months, can be attributed to sustained buying by foreign institutional investors (FII), supported by robust domestic fundamentals, improving macroeconomic indicators, and strong quarterly performance by Indian companies.
The recent decision of the Indian central bank to pause the interest rate hike cycle has further boosted sentiment in the domestic equity market. Foreign portfolio investors (FPI) have shown considerable interest in Indian markets since the start of the financial year 2024, with FPI inflows crossing $10 billion so far. In April, FPIs invested $1.4 billion, followed by $5.3 billion in May and $3.7 billion in June, according to data from the National Securities Depository Ltd. (NSDL).
Mukesh Kochar, National Head of Wealth at AUM Capital Market, believes that India will continue to attract FPI money due to its comparative advantage over other emerging market economies like China, Korea, and Taiwan. Kochar expects improved earnings in certain sectors and anticipates a better June quarter. He maintains a bullish outlook over the long term, emphasising the presence of significant investment opportunities in the market. However, Kochar advises investors to focus on asset allocation rather than timing the market and encourages them to consider the bigger picture in the long run.
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