Nifty closes at record high, Sensex likely to follow suit: Experts

NEW DELHI:  With the Nifty breaching its previous peak of 15,432 on Friday, experts feel that Sensex or the 30-stock index will also touch a new peak in coming sessions and may gain around 3,500-6,000 points by the end of this year. Sensex is still over 1,000 points away from 52,516 — a high recorded in February.

“We are expecting the bull run to continue and till December 2021 we would see 17500 on the nifty and 57500 on the Sensex,” said Shrikant Chouhan, Executive Vice President, Equity Technical Research at Kotak Securities. 

After a temporary break, mainly due to weak global cues and peaking of second Covid-19 wave, India’s equity market has started to surge since the last two weeks.

With the country seeing a dip in daily fresh cases, Nifty50 gained 260.35 points or 1.72 per cent during the week to close at a record high of 15,435.65 while BSE Sensex was up by 882.40 points or 1.75 per cent to 51,422.88. 

Gaurav Garg Head of Research CapitalVia Global Research believes that the bull run might continue, however not as sharp as they have seen last year.

“I expect there is room for 8-10 per cent of upside from current levels and NSE Nifty-50 might end the year at 16,500-16,800. BSE’s Sensex might cross 55,000 till the end of this calendar year,” Garg added. 

According to him, strong global sentiments along with better-than-expected quarterly numbers across sectors in the coming quarters will be the key going forward.

That apart, the monsoon season and vaccination drive will also be very important for the market. 

Chouhan noted that the drive will be due to optimism on economic recovery.

Based on the trend of the currency, the foreign institutional investment inflow may increase for emerging markets.

Research and broking house Morgan Stanley in a note said that India’s equities are likely to outperform their emerging market peers in 2021.

It kept its December 2021 target for the S&P BSE Sensex unchanged at 55,000 levels (base case; 50 per cent probability) for now —an upside of around 10 per cent from the current levels.

Morgan Stanley went on to add that in a bull-case scenario (30 per cent probability), the Sensex can touch 61,000 levels — an upside of around 22 per cent from the current levels, while in a bear case scenario (20 per cent probability) it can go down to 41,000 levels by December 2021.

Stock wise, Chouhan pointed out that Commodities, Real Estate, Agro Commodities, Pharmaceuticals, Technology should outperform others while FMCG, Auto and Financials may underperform this year. 

According to Garg, the broader indices are most likely to show stronger performance compared to large caps. 

“One thing that has changed is the commodity cycle which has turned up, and this might help certain sectors where traction is likely to be observed such as metals, sugar and textile. Investors should try to accumulate these stocks at any dip as stocks have rallied much and a correction is expected out of some profit booking. Rate sensitive stocks might show some under-performance which includes Banking, NBFCs, Automobiles, Real Estate etc,” he added.