Hello Readers!
How are You all and how were all your celebrations for the NEW YEAR 2021? It’s silly to ask, obviously it will be great!
Well, we are now In the New Year 2021, and the previous year 2020 has passed, but there is still something that we should know about the last month of the previous year, that is, December 2020. Ah! That’s Market Insight for December 2020.
The market in December was full of stimulus packages but what prominent was, the wait and watch rule. Let’s see in points how the market reacted in December 2020.
1. US stocks were trading high in the month of December 2020. And this was geared up after the US Congress approved a $900 billion package, and Japan $700 billion. Thanks to liquidity and low repo rates, these left Equity the only investment option. The markets in December 2020, continued the rally, and the global market capitalization (total value of all listed stocks in the world) crossed $100 trillion for the first time! After the new mutant of coronavirus was announced in Britain, people were afraid that this will gain impact the market. But the mutant virus strain couldn’t dent the enthusiasm!
2. Interest rates were also less affected. RBI’s stance is great in terms of capital infusion towards all investment options, but the challenge is keeping inflation in check. The RBI has projected CPI inflation at 6.8 % for Q3 2020-21, and 5.8% in the subsequent quarter, and the aim is that demand recovery will revive growth on a durable basis.
3. Experts have optimistic thoughts regarding the demand recovery and back to the normalcy of the market. Their thoughts are gazing the attention due to various positive events like airport traffic tripling in Mumbai, CRISIL’s prediction of mutual fund AUM reaching Rs 50 lakh crore by 2025, auto sales recovery, rising oil demand, and the Finance Minister’s promise of a budget like never seen before in 100 years. Now the trending event of COVID-19 vaccine approval, by the Drug Controller of India (DCGI), also will gear up the market revival.
2020 was nothing more than a nightmare, the pandemic spread suddenly and disrupt everything. But while the new normal is nowhere near the normal we knew, it’s now beginning to trend more. It shows that the market in 2021, will be a good opportunity to reflect, plan, and prepare.
So basically, it is advised, do not stay away from the market in the year 2021, plan your investment and start investing. Here’s wishing you an amazing 2021, a year to get older, and if lucky, Pfizer!
For any kind of query regarding financial planning you can contact us at Shri Ashutosh Securities Pvt Ltd., we are here to help you in any way possible.
Happy Investing!
(Mutual Fund investments are subject to market risk Illustrations are for example only, there is no guarantee of returns. Past performance is not an indicator/guarantee of future returns).