New Delhi, Nov 10 – Analysts say India’s medium‑term growth outlook looks bright. Rising private investment and steady consumer spending helped the country’s stock markets rally in October, the HSBC Mutual Fund team said Monday.
HSBC flagged that “Nifty valuations are modestly above the 10‑year average; we remain constructive on Indian equities.” The firm also highlighted the 2‑ to 4‑year corporate bond market as a good place to look. “Inflation expectations and growth uncertainty mean the RBI could cut rates by 25 basis points on Dec. 5,” the report added.
On the equity front, HSBC noted a potential bottom in the growth cycle. “Interest rates and liquidity cycles are easing, crude oil prices are falling, and a normal monsoon should give growth a lift,” it wrote.
Tax reforms should also boost the economy. GST cuts, along with earlier income‑tax cuts, are expected to lift private consumption and support private capital spending, the report said. The government’s focus on investment, a manufacturing push, and a real‑estate recovery are expected to keep momentum going.
The Indian stock market posted a strong October rebound. The Sensex and Nifty both rose more than 4 percent, helped by foreign institutional investor (FII) inflows and a boost in domestic sentiment. The mid‑cap index moved up 4.8 percent, while the small‑cap index gained 3.2 percent.
Securities such as real estate, oil & gas, metals, banks and IT outperformed the Nifty. Healthcare, power, fast‑moving consumer goods (FMCG) and autos lagged behind.
Market watchers will be eyeing the next set of economic data – November’s CPI inflation, trade deficit, GDP numbers and GST collections – to gauge the RBI’s move on policy rates. HSBC noted that liquidity remains tight despite the RBI’s foreign‑exchange interventions. Yet markets expect a liquidity boost through the central bank’s upcoming open‑market purchase (OMO) programme.
Overall, the HSBC outlook keeps India’s growth narrative positive, with steady private investment and a resilient consumer base driving both equity and bond markets.
Source: ianslive
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