We expect a modest return of 10 to 12 per cent on the main market in CY24, says Vinod Nair, Head of Research at Geojit Financial Services.

It is advised to diversify the investment pattern to multi-assets. It is suitable to be diverse when equities are trading above the long-term average for a prolonged period

The euphoria is expected to continue during the start of the next year on account of the exuberance of rate cuts and the drop in bond yields.

“We presume CY24 to be a year of reversal in sector and category wise. We like large-caps compared to mid and small-caps. Generally, it will be a stock- and sector-specific year. Sectors we like are Banks, Manufacturing, Pharma, Chemical and IT. A correction in the consumer sector should be capitalised in CY24,” he said.

Despite a slight profit booking on the last trading day of the year, the domestic market experienced a gradual rally, riding on the positive global market trend. The optimism is fuelled by expectations of rate cuts by the US Fed and a cooling global inflation scenario, he said.

Further, an ease in red sea disruption and a reversal of FII inflows supported the market to touch new highs. The anticipation of political stability in the upcoming national poll in 2024 and a positive market outlook are supportive factors. Sector-wise, auto and FMCG outperformed in expectation of a revival in demand, while the IT sector underperformed due to profit booking.

Profit booking and the developments around the Middle East, the movements in the Dollar Index, etc., are likely to influence the markets at the periphery in the coming week, says Joseph Thomas, Head of Research, Emkay Wealth Management.

We expect the market to continue its ongoing positive momentum in the near term driven by healthy macros, strong FIIs inflow and positive global cues. Next week is likely to be eventful as a series of economic data globally are set to release. Auto is likely to remain in focus as OEMs will announce sales numbers for the month of December, says Siddhartha Khemka, Head – Retail Research, Motilal Oswal Financial Services.