Indian Markets Outlook

Key trends that ruled 2024 and what investors can expect in 2025

- Viral Bhatt

As we approach the end of 2024, Indian investors are reflecting on a year marked by both growth opportunities and challenges. As we look forward to 2025, it's essential for investors to understand the macroeconomic trends, anticipate potential market shifts, and adapt their financial strategies accordingly.

2024: Year of Resilience

Stock market performance: The Indian stock market in 2024 has shown resilience, with the Sensex and Nifty continuing to climb, driven by strong corporate earnings and a stable domestic economy. The ongoing recovery in sectors such as IT, pharmaceuticals, and banking has been encouraging. Companies like TCS, Infosys, and HDFC Bank have posted healthy results, reflecting the strength of the Indian corporate sector. However, the global economic environment has remained turbulent, with rising interest rates in developed economies, inflationary pressures, and geopolitical uncertainties.

These external factors have created volatility, leading to periodic corrections in the market.

Interest rates and fixed-income investments: In response to inflationary pressures, the Reserve Bank of India (RBI) has continued to raise interest rates through much of 2024. The higher repo rate has resulted in increased borrowing costs for consumers and businesses. For fixed-income investors, this has meant better returns on instruments like fixed deposits, bonds, and government securities. However, those with loans or mortgages have felt the pinch, as EMI burdens have risen.