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Tuesday, March 9, 2021

By the end of 2021, the Sensex could reach the level of 61 thousand points: Morgan Stanley

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MUMBAI: Amid a stock market rally after a better-than-expected budget, foreign brokerage firm Morgan Stanley has said the Sensex is likely to reach 61,000 points by the end of 2021. He said the Sensex could reach 61,000 if the current rally continues.

However, Morgan Stanley has raised its target for this year from 50,000 to 55,000. He believes that if corporate earnings rise by 37 per cent next year and the US dollar depreciates, foreign investment will increase, and in this case, the Indian stock market will see a sharp rise.

In a note, Morgan Stanley said a new sentiment has emerged in a market where no new income tax has been declared. In addition, the decision to privatize two state-owned banks and one insurance company to boost growth by raising costs behind infrastructure as well as to raise capital through disinvestment will boost the market.

Morgan Stanley said the budget lays the foundation for the Indian stock market to rise in line with global markets. He also mentioned the cyclinical sectors, interest rates and sensitive sectors as well as midcaps.

The stock market rallied just when Finance Minister Nirmala Sitharaman presented the budget on February 1, and the Sensex jumped 2300 points. This boom continues today. The Sensex was washed out after hitting a historic high of Rs 50,000 in the previous week of the budget. The government has announced huge investments in infrastructure to increase the flow of capital into the economy, and huge spending will also be made in healthcare.

Morgan Stanley says that if the budget announcements are properly implemented, it will increase the share of corporate profits in the country’s GDP.

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