Did you know that the last time the Indian benchmark indices – S&P BSE Sensex and Nifty – ended a calendar year in the red was way back in 2015?
Since then, the benchmarks have been clocking gains in every calendar year and this is the longest-ever winning streak for the indices, outpacing the six-year record streak witnessed from 2002 to 2007.
While the current calendar year saw both Sensex and Nifty touch new record highs, the recent past has seen some amount of correction even as the indices managed to end the year with single-digit gains.
The 30-share Sensex gained 5.78 per cent while the Nifty moved up 4.33 per cent in the calendar year 2022 (CY22).
Meanwhile, the Sensex has gained a whopping 34,723.20 points or nearly 133 per cent starting 2016 while the broader 50-share Nifty is up 10,159 points or nearly 128 per cent in the same period.
| Year | Sensex | Nifty |
| 2016 | 1.95 | 3.01 |
| 2017 | 27.91 | 28.64 |
| 2018 | 5.91 | 3.16 |
| 2019 | 14.38 | 12.02 |
| 2020 | 15.75 | 14.90 |
| 2021 | 20.45 | 24.12 |
| 2022 | 5.78 | 4.33 |
| Source: BSE, NSE |
Incidentally, the six-year period between 2002 and 2007 (both years included) saw the Sensex and Nifty gaining 523 per cent and 480 per cent, respectively though the gains were lower in absolute numbers – the higher percentage gains were primarily on account of the low base effect.
While both the indices gave gained in every calendar year starting 2016, the best year in terms of returns was witnessed in 2017 when the Sensex and Nifty gained 27.91 per cent and 28.64 per cent, respectively.
“Indian markets outperformed most other markets in 2022 benefitting out of better management of macros including inflation management and corporate earnings that did not disappoint majorly despite challenging times,” said Dhiraj Relli, MD & CEO, HDFC Securities.
“This meant that India got a larger than proportionate share of FPI funds directed towards emerging markets. Rising trade/fiscal deficit and pressure on rupee were viewed negatively,” he added.
Interestingly, the benchmarks registered gains in the year even as foreign portfolio investors (FPIs) were net sellers in the equity segment. Overseas investors were net sellers at $16.5 billion during CY22 – a huge reversal when compared to the Covid year of 2020 when FPIs were net buyers at a little over $23 billion.
“As we enter 2023, India could continue to benefit out of high investment to GDP ratio (at 33% in FY23 versus 30.5% in FY21), higher infra, railway, road and defence spend by government; continued revival in real estate sector, PLI driven investments and supply chains are being consciously decoupled as national security concerns outdo economic efficiency,” says Relli while adding that India’s trailing outperformance could take a breather in the first half of CY23, given its relative valuations.
Key developments tracked in 2023 — other than earnings — would be state elections, Union Budget, RBI monetary stance, trends in trade and fiscal deficit, inflation moves, geo political situation globally, commodity price trends globally, and economic growth momentum in the world among other things, says Relli.
Meanwhile, some of the concerns or worries going ahead could be related to inflation, fiscal & current account deficit, and the manner in which renewed concerns related to Covid unfolds.
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