The journey of Nifty: From 11000 to 21000 in a span of six years

The Nifty50 index rose above 21,000 for the first time after breaching 20,000 in September. The move from 20,000 to 21,000 has been underpinned by growing risk appetite globally on optimism that the US Federal Reserve has done hiking interest rates.

Hopes that the US economy will see a ‘soft landing’ and the Fed will soon start cutting interest rates have also prompted investors to increase their equity market wager.

Following the sharp rise in the markets, most positives have been priced in, say experts. However, India’s strong macro and robust earnings growth estimates could see the domestic markets make further strides.

“We expect corporate profits in India to grow 15 per cent in 2024 and another 14 per cent in 2025, with growth appearing broad-based across sectors. An improving profits-to-GDP ratio and stabilisation in a decade-long earnings downgrade cycle in recent years suggest a turnaround in the earnings cycle,” said a recent note by Goldman Sachs, which has set a December-2024 target of 21,800 for the Nifty. 

The blue chip-focused Nifty index has taken nearly six years to move from 11,000 to 21,000, implying an annualised growth of 11 per cent.