Indian stocks off to a weak New Year, trading marginally lower in red

The Indian stock indices had a slightly negative start to the New Year, carrying over losses from the previous trading session. This was mainly because investors were taking profits following an impressive 2023 cumulative performance. As analysts have noted, high valuations are also cause for concern. The benchmark indices, Sensex and Nifty, settled the session marginally lower on Friday, the final active session of 2023, mainly as a result of profit booking and muted global cues. Investing in Indian stocks has yielded excellent returns for investors over the last 12 months. Despite some volatility, primarily during the Adani-Hindenburg scandal and more recently during the early stages of the Israel-Hamas conflict, stock market investors saw substantial financial gains in 2023.

In 2023, Sensex and Nifty gained 18-19 per cent, on a cumulative basis. The indices had gained a mere 3-4 per cent in 2022.
Foreign Portfolio Investors (FPIs) have trained their sight towards India, becoming net buyers in the country’s stock market in the calendar year 2023.
In December, especially, they made a beeline to invest in Indian stock markets, with a cumulative accumulation of Rs 66,135 crore. To put it into context, the entire year saw an inflow of about Rs 171,107 crore, and notably, over one-third of it came in December. In November, the FPI inflow was Rs 9,001 crore, data from the National Securities Depository (NSDL) showed.