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  • Category: Stock Market

    Where will be stock market in 2-3 year time frame ?

    Where do you see stock market in the next 2-3 years, whether it will remain stagnant, go up or move down? Get opinions and answers from the experts in the field of stock market.

    As the interest rates of FDs in banks are on a sliding path many people are shifting their investments from bank FD to stock markets specially investing in mutual funds.

    Stock markets are very sensitive to political situations, financial results of companies, demand of goods and services etc and due to this there are fluctuations in the stock prices and it becomes difficult to predict the movement of market.

    Now if we look back 2-3 years we find that markets are fluctuating in the range of 25000 to 29000 (as per BSE index). So we can say that for last 2-3 years market was range bound.

    What is your opinion regarding the stock market in next 2-3 years - whether it will remain stagnant and range bound like past 2-3 years or go down or go much above 29000 ?
  • #141286
    Predicting stock market will be harder in current circumstances. As business are flourishing in this governments regime. The same can't be happening in congress government if they come back. The reason being the current government reduced the paperwork and process. However congress will bring back a lot of red tape stuff which makes it harder for business and individual to save money and time. So lack of infrastructure focus, makes it harder for growth. Industries such as real estate, IT and medicine will continue at current pace, but if congress government does not pay attention to farmers and other sectors will lead to same situation where we were prior in 2010. So FD rares are likely to come back if government is changed. Mutual fund in equity side are likely to have some roller coaster and debt may remain steady. Still timing the market perfectly would be lot harder. I don't think congress government which is likely to form is going to take any decision on tax slab. So that is going to be one more problem.

  • #141288
    The author must note that stock markets are always volatile and surely behaves as per the government actions and moves based on different situations. Even politics can have the influence on stock markets. For example the results of five state which are going to the polls and the process are underway can also determine the market situations in the coming days. Likewise the actions of RBI on the banks, and the bank interest rates and over all the inflation effect on the economy are the best indicators of stock position. Therefore predicting for something which is 2 to 3 years away is not feasible and not possible.
    K Mohan
    'Idhuvum Kadandhu Pogum "
    Even this challenging situation would ease

  • #141289
    The current PE of SENSEX and NIFTY clearly indicates that the stock market has been rapidly moving upwards since the present Government has come to power in May, 2014. Various other factors are also responsible for this happy phenomenon. The coming down of price of petroleum and upward movement of GDP are another two major factors for the upward trend of the stock market.
    If you invest a substantial amount in share market at this present juncture, you can't expect much price appreciation at this stage. It is felt that the share market will start coming down within another year or so.
    In view of the same, if you want to enter share market at this juncture, I would advise you to do so gradually and not at one go. I can also advise you to stick to bluechip stocks, because the mid-cap stocks have been appreciating rapidly compared to bluechip stocks during last three years.
    So far a period of three years, caution must be exercised. It would be better if you invest in a large-cap equity mutual fund through SIP route.

    Beware! I question everything and everybody.

  • #141290
    No one can exactly predict how will stock market perform after two o three years. It is an area where there are changes happening every day, every hour.

    However those who keenly observe the financial markets, the economic conditions developing in this country and in other countries especially those who have relations with this country, changes in the political formations and alliances and importantly, the changes in government policies and taxation- can give a considered guess about what future holds.

    However even that can go wrong. For example when the US elections were going on, not many thought that Trump will win. However when he won at last, and declared some of his pet ideas, the stock markets in US, India and many other countries reacted immediately and many companies lost their share prices. However there could have been many other companies (like some domestic companies in US) which could have gained also.

    Within the next two to three years there is going to be general election in this country. If the same current ruling party continues to be the winner, then market can expect continuation of current policies and expect stock markets to be better. However in case there is a change of government, then the guess cannot hold.
    Even within a month also things can get changed. The election win in the states of UP, Punjab etc can affect the confidence and majority in Rajya Sabha, next President's election etc. All this will have bearing on the economy and on the financial markets also.

    However we can say one thing generally. Our economy is growing. Hence the financial markets also will be growing. As an investor, you may stay invested and not react in panic to any situation. You may observe the markets and continue investing in well established companies which have steadily increasing financial parameters and reputation.

  • #141322
    Market - sentiments can be predicted with the decisions taken by the government. If the Government really means business by offering several - concession to the industrialists by cutting excise duty wherever it is applicable and offers a conducive climate for the production of essential finished items such as steel - products of different varieties, Copper, Alumunium, Zinc etc. Moreover, such productions are consumed at a consistent rate. Such production and consumption cycle of the products would create a climate for the growth of industries and in turn stock market would see the golden phase.
    The policy of the Government for the strengthening the infrastructure would lead to increased production of steel, cement, aluminium etc. This would create a favourable impact in the stock market and this could lead to spiral of the related stocks.
    The present Government seems to be sincere in its efforts and if there is continuity of the service of the same Government, we would see a lot of positive improvements in our economy including a healthy surge in the stock -market.

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