2022 vs 2021: How much stock investors gained

The Sensex is up about 5% or  3,000 points this year. In 2021, equity investors reaped handsome rewards as their wealth grew nearly ₹78 lakh crore while Sensex gained 10,502 points or 22%.

“The most significant feature of 2022 is the outperformance of the Indian market. In a year in which S&P 500 is down by 20% and most markets are down between 10 to 20 %, Nifty is up by 4.8%. This outperformance is the result of mainly two factors: One, India’s superior economic growth; two, domestic investors support the market by buying every dip caused by FII selling,” said VK Vijayakumar, Chief Investment Strategist at Geojit Financial Services.

“These two factors are expected to continue in 2023 too. Dollar index dipping below 104 is a positive for the market. This trend is likely to sustain forcing FIIs to turn buyers in India in 2023. Q3 results starting from January 12th will be the next trigger for markets. Capital goods, financials and construction-related segments are likely to post good results,” he added. 

Axis Securities says as current valuations offer a limited scope of further expansion, an increase in corporate earnings will be the primary factor that would drive the market returns moving forward.

The market capitalisation of BSE-listed firms has zoomed ₹16,36,254.63 crore to ₹2,82,36,466.18 crore till December 29 this year. On December 29, the Sensex closed at 61,133.88 points.

On December 5, the market capitalisation (m-cap) of BSE-listed firms reached an all-time high of ₹290.46 lakh crore.

Sensex traded in a wide range this year, touching its all-time high of 63,583 points on December 1 while hitting its 52-week low of 50,921 points on June 17. During the initial part of the year, markets were jolted by the Russia-Ukraine war.

This year also saw the listing of LIC, which came out with the largest issue size of ₹20,557 crore. The insurer, which was listed in May this year, commands a market valuation of ₹4,32,440.09 crore.

Axis Securities believes that the prevailing volatility in the global markets is likely to continue for some more time, especially in H1CY23 before it sets on a more concrete trend. 

“The direction of inflation, the dollar index, oil and commodity prices, and the China reopening will further drive the market fundamentals in the first half of 2023. In any case, we continue to believe in the long-term growth story of the Indian equity market, which is well-supported by the favourable structure emerging with increasing capex enabling banks to improve credit growth,” the brokerage said. 

“The Union Budget – 2023 stands critically important for zeroing on any view as it’s the last full-year budget before the Union Election 2024. We expect Budget 2023 to be a growth-oriented budget given the state election lined up in over 9 states in 2023,” it added. 

(With Agency Inputs)