Every year from 1988 through 1994, the Sensex produced double-digit gains. The returns are at their lowest level since 2016 and are in single digits for the first time since 2019. However, if we use a global perspective, the Indian market will do considerably better in 2022. The Indian stock market appeared to be in better shape than those of other nations because of the economy’s comparatively better prospects. The main indexes ended the year 2022 with increases for the seventh year in a row. The Sensex has increased for seven years straight for the second time since economic liberalization.
A return of more than 4% in 2022 may not seem noteworthy after three years of double-digit growth in the Indian stock market, but the market’s performance has been excellent when compared to other global markets. With a return of 4.4% on the benchmark index Sensex and a return of 4.3% on the Nifty, the year has ended.
The results seem significantly better when we contrast Indian indexes with international indices. Despite the fact that returns in 2022 were low, the Indian market has outperformed other international markets. This year, both the Morgan Stanley Capital International World Index and the Morgan Stanley Capital International Emerging Market Index had declines of 22.3% and 19.2%, respectively. The Dow Jones Industrial Average fell 8.6 percent over the year, while the S&P 500 index fell 19.4 percent and considered worst year since 2008.
Because of the war between Russia and Ukraine, commodity prices began to fluctuate. Aside from this, investors continued to worry about the post-tax stimulus being disregarded following the Chinese shutdown and the worldwide pandemic. But, the way the Indian government dealt with the effects of the Covid outbreak and the way the treasury was handled, it allowed local investors to take daring moves. The RBI did not raise interest rates quickly. Additionally, this boosted domestic investors’ excitement. Retail investors made direct purchases of the shares as well. This contributed to the shares rising higher as well. This year, there were over 100 million DEMAT accounts. In terms of the index, investors didn’t have a lot of cash. The majority of retail investors made investments through SIP. With the aid of brokerage firms, investing is now simpler than ever, and investors just need to pay a little charge for the privilege.
While several major central banks had constantly stated last year that inflation would not endure for long. In the year 2022 inflation grew to the point that central banks had to limit economic development in order to control it. The US and other economies had multi-decade highs in inflation. The difficulty increased. But The Indian market has done well and is likely the best-performing big market. This demonstrates how robust the Indian economy is.
