'I am more optimistic about India than before.'
'The pain can be more in the days ahead.'
'Selling could further intensify and take the index towards 22,800-22,750 in the near-term.'
'2025 is the year to build a portfolio for the future. Focus this year should be on valuations and visible growth.'
The last time these two indexes recorded a negative performance on a calendar year basis was in CY19.
India is among the three least-favoured Asian stock markets, according to BofA Securities whose survey found that 10 per cent of fund managers are underweight on Indian equities from a 12-month perspective.
'Geopolitics will be the most important driver of financial markets in 2025.'
From the outcome of the general elections and then Union Budget to tepid corporate earnings in the September 2024 quarter (Q2-FY25), sticky inflation and Reserve Bank of India's stance on interest rates, extreme weather conditions, Indian stock markets have braved it all in calendar year 2024.
Gold price outlook 2025: Gold prices that have climbed over 30 per cent so far in 2024 to Rs 7,300 per gram in the Indian markets (up 28 per cent in dollar terms till November-end), are set for their best calendar year performance in 10 years, suggests a recent report by World Gold Council (WGC). However, this stellar run, analysts believe, may not carry through till the end of 2025 in the backdrop of economic and geopolitical headwinds.
As regards mid-caps and small-caps, analysts suggest investors buy only those stocks of those companies where there is earnings visibility for at least a few quarters and where the valuations have become reasonable.
'To be able to sail through such volatilities, it is prudent to focus on quality.'
Analysts are warning of growing risks to the market's sustained momentum, and even to the possibility of consolidation at current levels. Domestically, markets are grappling with several challenges, including a slowing economy, as indicated by the latest GDP data for the July-September (Q2) quarter of 2024-25 (FY25), sticky inflation, fluctuations in the rupee, waning consumption, and high interest rates.
The Indian market remains an attractive place to do business for the nation's entrepreneurs, with 75 per cent of them operating domestically.
'On the weekly chart, the Nifty 50 index has formed a bearish candle and remains below all short-term moving averages.'
The outcome of Maharashtra state elections is unlikely to move markets much, said analysts. The markets, they believe, have bigger developments to worry about in the short-to-medium term.
The sharp pullback in mid and smallcap stocks signals a cooling-off period in segments that previously attracted considerable investor interest.
Retail investors have become a force to reckon with in the last 10 years with their ownership of Indian equities rising 800 basis points, or 8 per cent, to 23.4 per cent during this period, suggests a recent note from Morgan Stanley. This number, Morgan Stanley said, is set to rise in the next few years as Indian households are still underinvested in equities. India's demographics, policy framework, investor education and modest positive real rates, it said, will fuel the 'equity cult' in India.
'Investors looking at the next 6-12 months can be certain that the Fed will maintain its easing cycle, and we expect the overall environment to be conducive for fixed income investments for portfolio diversification.'
If technical analysts are to be believed, the index has more room for a slide down to 72,000 levels in the worst-case scenario, wiping out all the gains made in 2024 so far.
After a strong run in the midcap and smallcap indices, which surged 46 per cent and 43 per cent, respectively, on the National Stock Exchange (NSE) during Samvat 2080, analysts suggest that the rally in these segments may pause to catch its breath in Samvat 2081.
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