The domestic market is on the rise. Equity benchmarks Sensex and Nifty 50 reached their new all-time highs for the second session in a row on Wednesday, December 28, led by gains in stock markets and financial India
The Nifty 50 opened at 21,715 against its previous close of 21,654.75 and touched another all-time high of 21,801.45 during the session. The index finally ended 124 points or 0.57 per cent higher at 21,778.70.
The Sensex opened at 72,262.67 as against 72,038.43 previously and touched a session high of 72,484.34. The index ended up 372 points or 0.52 per cent at 72,410.38.
The BSE Midcap Index also hit a session-high of 36,556.64, finally rising 0.66 percent to 36,528.19.
The BSE Smallcap Index ended 0.23 per cent higher at 42,382.30.
The domestic market has had a strong bull run since November. After gaining 5 per cent in November, both the Sensex and Nifty 50 have jumped more than 8 per cent so far in December.
Experts emphasize healthy domestic figures, inflation in the US. cooling, prospects for price cuts, US. bond yields and continued decline in the dollar, as well as an emphasis on foreign investment banking (FPI) purchases as some of the key drivers for the market
Additionally, experts confirm that after strong gains in the mid- and small-caps, investors’ money is now flowing to larger banks due to valuation relief.
Retail investors have also been a major factor in the rise of the domestic market.
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While analysts are positive about the prospects for the market in the medium to long term, they express concern that market valuations have increased due to a significant expansion in the market that could trigger a merger. Risk-averse investors can book a profit in this case.
The latest phase of the rally has left valuations at historical levels, with the Nifty trading at a one-year forward price-earnings (P/E) multiple of 19.9 times compared to a five-year average of 17.97 , with the Sensex P /E at 20.56 times against the historical average of 18.77 times . The one-year growth rate of the Sensex is actually close to a two-year high.
"An important market signal is the volatility index VIX rising above 15. Investors should take this as a sign of significant volatility. Residual investments are important in a bull market. But the market." chasing at higher valuations would be too risky," VK Vijayakumar , Chief Economist at Geojit Financial Services.
"Markets remain in an overbought state with a strong upward trend that is particularly sensitive. Going forward, we feel we could see a price or time-wise correction so some profit booking is certain." about being healthy and worth it in this number of records if it's sitting in money." " is to provide an opportunity to invest in dips," said Aditya Gaggar, director of progressive shares.
"A balanced approach is important for investors and traders. Position traders may consider booking partial gains while cautiously monitoring potential growth. To apply subsequent stop-loss orders and maintaining a smart risk management strategy can help navigate market uncertainty," Choice Broking Equity told research analyst Mander at a dinner.
Shreya Jain, founder and managing director of SAS Online, says investors should take a stock-specific approach rather than focusing on broad stock price movements.
Jain said knee-jerk reactions to news or a market hitting another high should be avoided.
Additionally, he pointed out that the results for the third quarter should provide information for earnings growth.
"Earnings growth going forward will dictate allocations to stocks. Investors don't follow momentum stocks where stock prices have no fundamental support for buoyancy. Volatility bouts can't be run out given flow of events like election results and monetary policy review. Buying on dips." fundamentally strong big and mid-caps." It can be a great way to accumulate reserves. The Nifty could touch 22,400 in no time," Jain said.
