My Prediction For Stock Markets In 2022

My Prediction For Stock Markets In 2022

2021 was the best year for #indianstockmarket, and investors who have put a significant chunk of their savings would have realised a handsome return. However, the last two weeks witnessed market correction due to #Omicron‘s fears.

However, in my view, globally, the biggest threat to stock market momentum in 2022 is #Inflation and not COVID. The reason is that the markets and companies have learned to navigate the COVID risk. However, if Inflation continues to rise, the central banks would be forced to hike the interest rates, diverting surplus funds from FIIs/DIIs from equity to bond markets.

My predictions for stock markets in 2022 are as follows:

1)2022 would not have the 2021 momentum; the markets would get flat with minimal upside.

2)Investors, not traders, would benefit from 2022 as people who invest in fundamentals would reap gains. The swing trading that worked well in 2021 would not continue.

3)Mid Cap IT stocks, realty/construction, and Capital goods should have a rally. My reason is that for IT, the demand for digitisation is highest. Further, the 2022 budget would focus on GDP expansion, boost Capex, and benefitting the capital goods industry and reality sector.

The IPO fever would continue to 2022, and in my view, the blockbuster IPO would be that of the LIC. If the bankers price the IPO correctly, the LIC IPO should be the most oversubscribed in Indian history.

FIIs would continue to sell and exit. Thus, it would be a litmus test for first-time retail investors to continue to invest in equities. In my view, most first-time retail investors would suffer a loss and exit the market.

In my view, 2022 would be the year investors should have a good year in the stock markets. For traders, #cryptocurrency should be a better asset than equities.

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