NEW DELHI: Domestic equity market closed the last trading session of the financial year 2023-2024 (FY24) on a high note as benchmark indices – BSE Sensex and NSE Nifty50 – advanced nearly 1% each. In one of the best fiscals for the domestic market, the Nifty50 and BSE Sensex gained about 29% and 25%, respectively, in FY24.
Sensex climbed to a high of 74,190.31 during Thursday’s trade but gave up some of its gains later. At close, the 30-share index was up 655.04 points, or 0.90%, at 73,651.35. The Nifty50 hit a high of 22,516.00, just 10 points away from an all-time high of 22,526. At close, the 50-share index was at 22,326.90, up 203.25 points, or 0.92%.
The two indices recorded their biggest rise in the soon-to-be-concluded FY24 since FY21 when record buying from Covid-19 lows led to a surge of up to 70% for the benchmarks. Excluding the FY21 gain, this fiscal’s gain is also the biggest for Sensex and Nifty50 since FY10 when global stocks rebounded from the global financial crisis.
Despite a sharp correction in March, small- and mid-caps outperformed the benchmarks, adding 70% and 60%, respectively, in FY24.
As per market experts, the burgeoning domestic economy, expectations of rate cuts by central banks and high inflow of foreign funds continue to shadow ‘premium valuation’ concerns of local equities. Foreign portfolio investors (FPI) bought shares worth over `2 lakh crore in FY2024, as of March 27.
“Indian equities closed the day and fiscal year on an optimistic note…An upgrade in the domestic economy forecast hints at an encouraging outlook for the stock market in FY25. However, the emphasis is on large-cap due to the persisting premium valuations of mid-cap stocks, which could pose a concern on the broad market in the short to medium term,” said Vinod Nair, head of research, Geojit Financial Services.
While the overall economic outlook remains stable, factors to influence the market in FY25 will be action taken by the Federal Reserves, and elections in India and the US. In short term, market will pay attention to Q4FY24 earning numbers. Joseph Thomas, head of research, Emkay Wealth Management, said going ahead the performance may remain closely linked to the economic performance, as there have been some concerns being raised with regards to the valuations.