Why Morgan Stanley Thinks the BSE Sensex Can Hit 50,000 by Dec 2021

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Why Morgan Stanley Thinks the BSE Sensex Can Hit 50,000 by Dec 2021
Credit: © Reuters.

By Aditya Raghunath

Investing.com -- Morgan Stanley has forecasted that the BSE Sensex will touch 50,000 by December 2021. That’s quite a bold prediction to make considering that the index was trading at sub 25,000 levels in March this year. However, Morgan Stanley (NYSE: MS ) believes that companies are getting back to normalcy and with multiple vaccine trials going off successfully, growth will surprise on the upside. Three other reasons why the Sensex will hit 50,000 are detailed below:

  1. Foreign institutional investors (FIIs) pulled out the money in droves in March after the market crashed but they have pumped in Rs. 44,378 crore in November, the highest in the last three months. Total inflow from FIIs for the year is at Rs. 92,300 crore.
  2. Out of 50 companies on the Nifty-50, 34 have beaten earnings estimates, 11 missed profit estimates, and 5 were in line with estimates, for the quarter ended September 30, 2020. This is a much better-than-expected recovery from the previous quarter that was decimated by the COVID-19 induced lockdowns.
  3. The government has announced several policy measures worth Rs. 2.85 lakh crore to stimulate the economy, help MSMEs (micro, small and medium enterprises), provide incentives for manufacturing, etc.

While the market has recovered to around the 44,000 mark in the first three weeks of November, the world is still not out of the COVID-19 woods yet. Morgan Stanley has cautioned that in case the pandemic continues into 2021 and the Indian government’s policies fall short, the index might fall down to 37,000.

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  • Shrey Agarwal @Shrey Agarwal
    Good Analysis.
    Like 0
  • Amit Golchha @Amit Golchha
    worst analysis. when it has crossed 45000 the so called analyst tells it 50k in 1.25 years. When it was near low they were telling it to go to 20k
    Like 9
  • Rakesh Prasad @Rakesh Prasad
    What about Nifty?
    Like 0

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