Sensex Records Remarkable 3,000-Point Jump in Just 13 Sessions, Surpasses 67,000 Mark

In an extraordinary bull run continuing for the fourth consecutive month, the benchmark index Sensex achieved a significant milestone by crossing the psychological threshold of 67,000 on July 18, 2023. The index’s upward trajectory persisted, and it reached an all-time high of 67,619.17 on July 20, demonstrating robust gains over the last 13 sessions.

This remarkable surge has seen the Sensex soar by an impressive 22 percent from its 52-week low of ₹55,158, witnessed on July 27, 2022. The surge owes its momentum to a confluence of factors, including substantial inflows from foreign portfolio investors (FPIs) into the Indian equities, marked improvements in the macroeconomic landscape, the nation’s burgeoning growth prospects, and the conclusion of India’s rate hike cycle initiated in January of the previous year. However, amidst these soaring valuations, investor concerns have surfaced.

India has emerged as the leading recipient of FPI flows among emerging markets, with FPIs investing a substantial ₹43,804 crore into the nation’s financials, automobiles, capital goods, realty, and FMCG sectors in July alone. This sustained influx has significantly propelled stock prices in these sectors, consequently pushing the Sensex and Nifty to new historic highs. Nonetheless, the prevailing concern among investors revolves around the escalating valuations, raising the possibility of potential sharp corrections in response to negative triggers.

Experts suggest that forthcoming market valuations will be heavily influenced by earnings growth and growth visibility across various sectors. Ascertaining the sustainability of this upward trajectory will largely depend on these critical factors.

In a recent analysis, Sriram BKR, Senior Investment Strategist at Geojit Financial Services, outlined key highlights of Sensex’s remarkable journey to the crucial 67,000 milestone. Let’s explore some of the key findings:

1. The rally from 63,000 to 64,000 took approximately 144 sessions or 7.1 months, while the subsequent leap of 3,000 points to 67,000 occurred in a mere 13 sessions, signaling an unprecedented speed in the latest ascent.
2. The substantial 7,000-point surge from 60,000 was accomplished over 450 sessions or 22.1 months, illustrating a steady and consistent trajectory leading up to the latest record.
3. Sensex’s journey to the initial 30,000 points landmark in April 2017 spanned 31.3 years, whereas the subsequent 30,000 points were added in just 4.4 years, underscoring a remarkable acceleration in market growth.
4. BSE’s total market capitalization crossed the noteworthy 300 lakh crore mark recently, further bolstering the overall financial landscape.
5. In a brief span of 3 sessions, BSE’s total market capitalization surged by over ₹6 lakh crore, coinciding with the Sensex’s move from 66,000 to 67,000 levels.
6. The Sensex total return index currently stands at 1.54 times the price index, significantly surpassing the 1.06 times recorded in 1999 and the 1.41 times when the Sensex crossed the 30,000 mark.
7. The average EPS of Sensex, calculated using the trailing 12M PE as of June 23, stands at approximately ₹2,706, reflecting a robust 10 percent year-on-year growth, a noteworthy 29 percent compound annual growth rate (CAGR) over two years, and an impressive 20 percent CAGR over three years.
8. In terms of investment growth, a prudent investment of ₹1,00,000 made in June 2003 would now be valued at around ₹24 lakhs as of June 30, 2023, in total return index terms.

The Indian equities market’s upward trajectory has been nothing short of remarkable, and its ability to maintain momentum hinges on sustained economic growth and investor sentiment. As investors and experts alike carefully monitor these indicators, the Sensex continues to chart new territory, shaping the future of India’s financial landscape.

Disclaimer: Investment in securities market are subject to market risks. Read all the related documents carefully before investing. The content in these posts/articles is for informational and educational purposes only and should not be construed as professional financial advice and nor to be construed as an offer to buy /sell or the solicitation of an offer to buy / sell any security or financial products.
Users must make their own investment decisions based on their specific investment objective and financial position and using such independent advisors as they believe necessary.