The Indian stock market is rapidly gaining momentum and becoming a prime market for companies worldwide. With predictions that it will reach 1 lakh in 2025, many are curious about the factors driving this growth. So, how is this possible and what exactly is causing the Indian stock market to thrive?
Growth Rate
Recent reports from reputable sources like the World Bank and IMF have confirmed what many already know – the Indian economy is currently the fastest growing economy when compared to other countries like America and China. With this consistent growth, it’s no surprise that the Indian stock market is expected to remain at the top.
Fed Rate
As an informed investor, it’s essential to understand the significance of the US Fed Rate. When the rate increases, many individuals opt to invest their money in American stocks or bonds. This shift in investment strategy causes an influx of funds into the Indian market from American and other international investors. As a result, it’s crucial to monitor the US Fed Rate and its potential impact on the Indian market.
Economic Policy
The Indian government is implementing a range of economic policies that are bolstering public confidence and encouraging investment in the stock market. One of these policies is the PLI scheme, which provides subsidies to companies looking to enter the Indian market. As a result of this scheme, numerous companies are now seeking to take advantage of the incentives on offer.
Retail Investors Trust
Due to the impact of COVID-19, the stock market experienced a significant decline in its potential. However, after the pandemic, retail investors started turning towards the Indian stock market in search of higher dividends. One of the factors that contributed to this trend is the stable inflation rate in India, which has instilled trust in people to invest more in the stock market. Furthermore, the strong global relationships that India has with other countries have also played a significant role in attracting investors to the stock market.
Conclusion
In conclusion, the Indian stock market’s rapid growth is due to various factors, including the country’s consistently high economic growth rate and the US Fed Rate’s impact on international investments. With predictions that the market will continue to thrive and reach 1 lakh in 2025, it’s an exciting time for investors looking to tap into this market’s potential. By staying informed and understanding these key factors, investors can make educated decisions and take advantage of the opportunities presented by the Indian stock market.