- Interest rates can be expected in 2024 to be lower than in 2019.
- Focus on long-term returns
- China’s move, PLI schemes, and tax cuts will help Indian manufacturing
Bombay: The Indian stock market has got off to a good start, with Nifty posting the best first week gains of 2.6% this year since 2015. Nifty also outperformed major global markets as US indices underperformed over the past year. the first week of trading in the new year.
To understand the rally and if it will continue, we spoke to Samir Arora, founder of Helios Capital who is currently in the US and shared his observation of inflation which should be seen as a rate hike in us. now expected sooner. He explained that wages in the United States are being increased and supply chain issues are still present.
Regarding liquidity flow and interest rate hikes, a detailed analysis shows that the inflow of around USD 4 billion was mainly in the primary market which goes to private stocks and venture capital, implying that inflows from FIIs are not direct to the equity market. Given these low inflows, it is difficult to say that last year’s rally was a cash-driven rally, however, it can still be seen as positive that India recorded net inflows while other countries recorded exits. Furthermore, it can be expected that even with the interest rate hikes, the interest in 2024 will be lower than it was in 2019, suggesting that the interest rate hike does not. is not a major problem at the moment.
Over the past two years we have seen higher returns and over the past calendar year the Nifty 500 Index has returned 30%. However, Samir focuses more on long-term average returns above other financial assets. He also shared that new technology companies listed have higher valuations and that it will take time to understand how this company will perform in the long term.
Speaking on the benefits to India from moving China, a 2-3% shift in investment flows from China to India will lead to a 10-20% increase in foreign investment in India. These inflows can be a win-win for financial investors as well as for companies looking to diversify the supply chain. These are some major parameters with the PLI schemes and the tax cuts will help the growth of India.