With the efforts of foreign investment and retail investors, the Indian stock market set a record.
On the morning of December 6, the market value of the Indian stock market exceeded $ 4 trillion for the first time, second only to the United States, India, Japan and Hong Kong, India.
The Indian stock market is one of the best stock markets in Asia and even emerging markets in 2023. The main benchmark stock index Nifty50 has increased by more than 13%this year.Kanpur Stock
Since the beginning of this year, the Nifty50 index has performed well.(Tradingeconomics)
According to the statistics of Bloomberg, after the low epidemic in March 2020, the market value listed on the two exchanges of India has doubled.If the current rise is maintained until the end of the year, the Indian stock market will set an unprecedented eight -year rising record.
"In the past 10 years, the Indian stock market has created an unparalleled growth rate in the past 10 years, whether it is a listed company or a stock index. This year, we have seen that small and medium -sized enterprises have performed well and they have contributed to recovery."
However, due to factors such as high valuation, geopolitics, economic uncertainty, and a large number of retail speculation, the Indian stock market still faces uncertain risks.
Fast entering of retail investors
Wall Street believes that there are several reasons for the recent rise in the Indian stock market.
First of all, the results of the local elections were released on December 3. The Indian People’s Party, which was affiliated to the Indian Prime Minister Modi, won three games in the four State Council elections in critical areas to pave the way for the Modern May election next year.Economic policies can continue.
In addition, the IPO frenzy set off in India in recent times has also promoted the fiery market in the Indian stock market."Economist" also pointed out that India is in a unusual IPO boom.As of the beginning of November this year, India has been listed in 194 companies, far exceeding 144 in 2022.
It is said that the recent rise in factors also includes good economic data and international declines.
Of course, if the time is stretched, since 2020, retail and foreign capital have helped the Indian stock market rise.
The Indian Trading Commission requires that everyone who wants to trade Indian securities must have a Demat account, and the Indian Central Stock Existence Services (CDSL) and the State Securities Storage and Management Corporation (NSDL) are the only two depositors, only these twoOnly home agencies can open DEMAT accounts.
As of August 31, 2022, the number of Indian central depository service service accounts was 71.650 million, and the number of investors in the national securities depository company was 28.859 million, and the two DEMAT accounts increased by more than 100 million.In contrast, in March 2020, the total number of two DEMAT accounts was only 40.9 million.The speed of retail investors is amazing.
From the data, the foreign -funded net purchase of Indian stocks has exceeded $ 15 billion this year.
Paris, France, predicts that from now to next year’s election, the Indian Nifty50 Index is expected to rise by 5%-8%.Varanasi Investment
The biggest risk is Modi?
The Indian stock market has been bullish for nearly 8 years, but behind the fiery, there is no shortage of risks.
One of the great risks is from the political turmoil caused by the Indian elections next year.
Chris Wood, head of the global stock strategy of Wall Street Ferry Group, pointed out that the Indian 2024 election is a major risk. If the Indian People’s Party where Modi is located cannot consolidate power, the stock market will rise.
"If the Indian People’s Party suffered such an accident in 2004, then I expect the stock market to have 25%of the callback, even more." Wood said that this means that India’s existing radical reform projects will be veryBig adjustment.
There have been similar events in Indian history.In May 2004, due to the failure of the National Democratic Alliance in governing, the founder of the Indian People’s Party, who served as the Prime Minister for three times, submitted his resignation.As soon as the news came out, the Indian stock market plunged about 20%within two days.
The high stock price is the biggest risk facing the Indian stock market.Due to the high market valuation and overheating transactions, the stock market is likely to call back at any time.
The Group and Lyon Securities warned that the valuation of the Indian stock market has been pushed very high. After foreign investment has invested over 10 billion US dollars to the Indian stock market this year, it may find better trading opportunities in other emerging markets.
In fact, at the beginning of the year, the former Indian richest man Adiden Edney Group was reported by the well -known US -known air institution Xingdaobao Research Company. After accusing him of fraud, the total market value evaporated at $ 86 billion, and the Indian stock market was dim.Escape.It was not until the second quarter that the foreign investment of India had reappeared as India’s overall economic performance exceeded expectations.
By October this year, according to the British "Financial Times" report, global investors have sold nets worth $ 1.5 billion in Indian stocks. This is the largest single -day sale since September 2022, including the Indian stock market income is half -mixed, and oil prices have risen.And the United States "higher and higher" suppressing investors’ appetite.
It can be seen that although the Indian stock market is rising, the investment investment is not smooth.
In addition, enthusiastic retail investors are also mixed for the Indian stock market.Indian authorities are concerned that many retail investors are not professional investors. They blindly listening to the so -called "experts" suggestions and gossip of social media may eventually lose money.
Former Chairman of the Indian Securities and Exchange Commission Tiaji said: "There are too many retail investors with limited financial knowledge in this market. Everyone hopes to make money easily, but the reality is that there is a bubble in the market."
Kolkata Investment