BofA, a worldwide brokerage, predicts Nifty reaching 20,500 by December 2023. Positive trends typically occurred three months before a US recession’s end and from FED’s second-last rate hike to six months after rate cuts (current phase).
After analysts from the US Federal Reserve, Bank of America (BofA), and JPMorgan changed their thoughts about a economic downturn in 2023, people who invest money in the Indian stock market are feeling better. They think that more money from other countries will continue to come into the market.
Bank of America, a big worldwide money company, thinks that by the close of December 2023, the Nifty index might get to 20,500 points. In earlier times, the Nifty index usually increased around three months prior to the conclusion of a downturn in the United States. It also tends to rise from the time the US Federal Reserve starts reducing interest rates (which is happening now) until six months after the rate cuts begin.
Amish Shah, from Bank of America, said that people from India who put their money into local company stocks will probably continue doing so. He also mentioned that there are some big companies whose stock prices are currently lower than what’s typical. This could be a good chance to buy these stocks. He mentioned that investing in smaller and medium-sized companies might not be the smartest choice at the moment, as they are already quite pricey.
Shah is of the opinion that the value of the Nifty index could increase further. Right now, the Nifty index is being bought and sold at a cost that is 19 times what experts predict it will earn next year. Usually, folks look at the Nifty’s usual cost as being 16 times its earnings, judging from how it has done before. But because the companies in the Nifty index have changed over time and now include more companies that are growing quickly, Shah believes it’s better to focus on the future. Viewed from this perspective, the Nifty’s price appears justifiable at a multiple of 19 times its earnings. Shah believes that if there is no recession in the US, more foreign money could come into the Indian market, and this might cause the Nifty’s value to go even higher.
Bank of America thinks that this could mean the Nifty’s value goes up quite a bit. They suggest that the Nifty’s value could go up to a level that is higher than what is usually expected.