Global market performance: Global equities markets finished 2023 on a positive note. Major global equity benchmarks have returned double digits.
SUMMARY
- By 2023, the bulk of global equities markets will have delivered investors with considerable returns.
- In the United States, the Dow Jones index increased 13.7%, while the tech-heavy Nasdaq index increased 43.4%.
- The Indian rupee outperformed the Chinese yuan, the Japanese yen, and the Russian ruble.
Global equities markets finished 2023 on a high note. Major global equity benchmarks have returned double digits. This outperformance was driven by a slowing of global inflation, a drop in the dollar index, lower crude prices, and increased anticipation of rate cuts by the US Fed and other central banks.
Global Stock Performance
The majority of global equities markets will have generated considerable returns to investors by 2023. The Dow Jones index increased 13.7% in the United States, while the Nasdaq index increased 43.4 percent. During the year, the German equity index DAX climbed by 20.3%, the French CAC 40 increased by 16.5%, and the British stock benchmark FTSE100 increased by 3.8%.
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In Asia, the Nikkei 225 in Japan rose 28.2 percent, followed by India’s BSE Sensex, which rose 18.7 percent. The Singapore Straits Times index, on the other hand, fell 0.3%, while the Chinese stock market Shanghai Composite Index fell 3.7%.
Currency Markets
In the year 2023, the US Dollar Index fell 2.2 percent to 101.029. The Indian rupee’s performance in the year 2023 was uneven. The rupee fell 0.54 percent versus the US dollar to Rs 83.186, while it fell 3.63 percent against the European currency Euro.
The rupee, on the other hand, outperformed the Chinese yuan, Japanese yen, and Russian ruble, rising 2.07%, 6.97%, and 28.58%, respectively.
Commodities
Brent crude oil prices fell 10.3% this year to $77.04 a barrel from $85.91 a year ago in the commodities segment. As of December 29, gold prices on the MCX had risen 15.4 percent to Rs 62,939 per 10 grams, while silver prices had risen 7.7 percent to Rs 73,019 per kilogram.
Foreign Investment Trends
According to Dr. V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services, the year 2023 will see significant investment by FPIs as a result of the sharp increase in flows in December. “FPI inflows, which had been negative for the previous three months, turned sharply positive in December, with a total purchase of Rs Rs 66134 crores.” This statistic covers both stock exchange purchases and primary market investments. The overall FPI inflows in 2023 are estimated to be Rs 171106 crores.”
The continuing decrease in US bond yields has resulted in this abrupt shift in FPI policy. FPIs were large buyers in financial services in December, which explains the segment’s resiliency in December. FPIs also invested in industries such as automobiles, capital goods, and telecommunications.
“Since 2024 is expected to witness further declines in U.S. interest rates, FPIs are likely to increase their purchases in 2024 too, particularly in the early months of 2024 in the run-up to the General elections,” he said.
Fequently asked question
Will stock market go up in 2024?
Analysts at all three companies gave S&P 500 price estimates for 2024 of 5,100, suggesting a gain of about 7% from the index’s current level. Oppenheimer’s chief investment strategist John Stoltzfus forecasts for a solid new bull market for the S&P 500. His price goal of 5,200 reflects a nearly 9% increase.
How high will the stock market be by 2025?
According to Ed Yardeni, the S&P 500 will reach 6,000 in 2025 in the ‘Roaring 2020s’ scenario.
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