NEW DELHI, Dec 31: Investors in the stock market saw their wealth increase by an astonishing Rs 77.66 lakh crore in 2024, buoyed by a generally positive trend in equities, highlighted by an over 8 percent surge in the BSE Sensex.
Analysts indicated that the year was characterized by a tug of war between bullish and bearish sentiments, featuring volatility. Despite global uncertainties, Indian markets withstood the pressures and delivered remarkable returns.
“The year 2024 presented both challenges and rewards for the markets. The Nifty steadily rose from January to September, hitting a record high of 26,277.35, before scaling back some gains yet still closing the year with significant increases. This marked Nifty’s ninth consecutive year of positive returns, despite the selling of shares by Foreign Institutional Investors (FIIs),” commented Prashanth Tapse, Senior VP (Research) at Mehta Equities Ltd.
The 30-share BSE Sensex rose by 5,898.75 points, or 8.16 percent, this year. The index peaked at an all-time high of 85,978.25 on September 27.
Due to the overall positive trend in equities, the market capitalisation of BSE-listed companies surged by Rs 77,66,260.19 crore, reaching a total of Rs 4,41,95,106.44 crore (USD 5.16 trillion) in 2024.
For the first time, the market capitalisation of BSE-listed companies crossed the Rs 400-lakh crore threshold on April 8 this year, having previously reached the Rs 300-lakh crore mark in July of last year.
“Earlier in the year, factors such as anticipated inflation moderation, expected interest rate reductions, and optimism surrounding the BJP’s re-election sparked a robust rally, elevating indices to record highs. However, while the election results favored the BJP, they did not amount to a complete landslide, prompting a brief market correction.
“The unwinding of the Yen carry trade in August—a global event where investors borrowed in low-yielding currencies like the Yen to invest in higher-yielding assets—triggered subsequent volatility. Nonetheless, the market rebounded, reaching new highs in September,” stated Amnish Aggarwal, Director of Research at Institutional Equities, PL Capital – Prabhudas Lilladher.
The initial euphoria was short-lived, as Aggarwal noted that a combination of significant FII outflows in October, heightened global uncertainties following the U.S. presidential election, and rising inflationary pressures led to a pronounced correction in the Nifty.
“While the Federal Reserve has commenced interest rate cuts, recent remarks regarding slower and less substantial cuts in 2025 have caused some disappointment,” he added.
From October onward, the markets faced bear pressures due to concerns over foreign investor withdrawals and inflated valuations.
In October alone, the BSE benchmark fell by 4,910.72 points, or 5.82 percent.
October witnessed an unprecedented foreign fund outflow of Rs 94,017 crore—the highest monthly withdrawal on record—due to increasing allocations to China, lackluster corporate earnings, and elevated valuations of Indian stocks.
“While Foreign Institutional Investors (FIIs) engaged in profit-taking due to high valuations, Domestic Institutional Investors (DIIs) continued to bolster the market,” remarked Palka Arora Chopra, Director at Master Capital Services Ltd.
Throughout the year, the Sensex achieved monthly gains in eight months. It only saw negative returns in January, May, October, and December.
Significant participation from retail investors played a crucial role in the market’s positive performance this year.
Additionally, several major Initial Public Offerings (IPOs) and share listings brought optimism to the equity markets.
Reliance Industries remains the most valuable firm in the country, boasting a market valuation of Rs 16,44,792.26 crore, followed by Tata Consultancy Services (Rs 14,82,402.82 crore), HDFC Bank (Rs 13,55,520.10 crore), ICICI Bank (Rs 9,04,975.61 crore), and Bharti Airtel (Rs 9,04,583.72 crore) in the top five.
In 2023, the market capitalisation of BSE-listed firms surged by Rs 81.90 lakh crore, while investors became richer by over Rs 16.38 lakh crore in 2022. (PTI)
