Stock market investors will certainly call for an encore of 2009. As the last trading session of the year drew to a close on Thursday, the Indian stock market had something to show off to the world; it had its biggest yearly gain since 1991, along the way helping investors to recoup their losses the year before.
The Bombay Stock Exchange (BSE) has risen 81% in 2009, driven by record inflows from foreign institutional investors (FIIs) and a rapidly improving economic environment. At close to 17,465, the 30-scrip BSE Sensex is now at a 19-month high, as is the broader 50-scrip Nifty at 5201.
Sensex, incidentally, will enter its silver jubilee year on Saturday. Sensex was launched by the BSE, the oldest bourse in the Asian continent, on January 2, 1986 with 1978-79 as the base year.
This year, FIIs have been big buyers of stocks across emerging markets and they pumped in $17.20 billion into the Indian market in the process. Of the inflow, about $3.3 billion came in through initial public offerings (IPOs) and American and global depository receipts. The pace of flows picked up sharply after the results to the general elections were announced in mid-May, with investors reassured of a strong coalition government at the Centre that could take forward the reform process.
Says A Balasubramanian, CEO, Birla Sun Life Mutual Fund, “In 2009, the markets were driven by the continuous improvement in the macroeconomic variables in the wake of some unprecedented stimulus both from the government and the central bank. “ Balasubramanian believes that while 2010 may not be as eventful for the market, equities should continue to do well, especially since it was unlikely that interest rates would go up in a hurry.
FIIs and domestic insurance firms have been the biggest buyers of Indian equities, with retail investors taking the sidelines. Indeed, many recent IPOs saw very subdued participation from retail investors. Domestic mutual funds, for their part, have seen muted inflows into equity schemes, especially after the entry load was done away with from August. Among the best performing sectors during the year were automobiles, metals and technology while realty was among the worst-performers.
The rally has been broad-based and volumes too have been large. The daily average turnover in the derivatives segment of the NSE in the last six months has been over Rs 72, 000 crore while the average daily turnover in the cash segment has been Rs 17,800 crore.
Volumes are expected to remain strong in 2010 though market watchers believe that the huge supply of paper, especially from public sector undertakings, could keep the secondary market in check. About 18 issues have been lined up and between them they are expected to help the government raise over Rs 28,000 crore, with NMDC alone expected to fetch Rs 14,000 crore. However, with India and China expected to remain among the fastest growing economies in the world, there is unlikely to be any let-up in foreign inflows.
Source: http://www.financialexpress.com/news/market-had-it-so-good-only-in-91/562031/0
The Bombay Stock Exchange (BSE) has risen 81% in 2009, driven by record inflows from foreign institutional investors (FIIs) and a rapidly improving economic environment. At close to 17,465, the 30-scrip BSE Sensex is now at a 19-month high, as is the broader 50-scrip Nifty at 5201.
Sensex, incidentally, will enter its silver jubilee year on Saturday. Sensex was launched by the BSE, the oldest bourse in the Asian continent, on January 2, 1986 with 1978-79 as the base year.
This year, FIIs have been big buyers of stocks across emerging markets and they pumped in $17.20 billion into the Indian market in the process. Of the inflow, about $3.3 billion came in through initial public offerings (IPOs) and American and global depository receipts. The pace of flows picked up sharply after the results to the general elections were announced in mid-May, with investors reassured of a strong coalition government at the Centre that could take forward the reform process.
Says A Balasubramanian, CEO, Birla Sun Life Mutual Fund, “In 2009, the markets were driven by the continuous improvement in the macroeconomic variables in the wake of some unprecedented stimulus both from the government and the central bank. “ Balasubramanian believes that while 2010 may not be as eventful for the market, equities should continue to do well, especially since it was unlikely that interest rates would go up in a hurry.
FIIs and domestic insurance firms have been the biggest buyers of Indian equities, with retail investors taking the sidelines. Indeed, many recent IPOs saw very subdued participation from retail investors. Domestic mutual funds, for their part, have seen muted inflows into equity schemes, especially after the entry load was done away with from August. Among the best performing sectors during the year were automobiles, metals and technology while realty was among the worst-performers.
The rally has been broad-based and volumes too have been large. The daily average turnover in the derivatives segment of the NSE in the last six months has been over Rs 72, 000 crore while the average daily turnover in the cash segment has been Rs 17,800 crore.
Volumes are expected to remain strong in 2010 though market watchers believe that the huge supply of paper, especially from public sector undertakings, could keep the secondary market in check. About 18 issues have been lined up and between them they are expected to help the government raise over Rs 28,000 crore, with NMDC alone expected to fetch Rs 14,000 crore. However, with India and China expected to remain among the fastest growing economies in the world, there is unlikely to be any let-up in foreign inflows.
Source: http://www.financialexpress.com/news/market-had-it-so-good-only-in-91/562031/0
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