A new beginning

Markets will focus on India's underlying strength

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The Nifty and the Sensex have gained about 25 per cent since last Diwali. Smaller indices have done even better. The NSE 500 is up over 30 per cent, while the small-cap indices have increased by more than 35 per cent. This is excellent performance against the given global backdrop.

India continues to be the fastest-growing large economy. Indeed, the US and India are the only large economies with satisfactory growth. Other regions have struggled with weak growth, high inflation, and geopolitical stress. The Ukraine War continues and the conflict in West Asia has escalated considerably. This has led to fears of energy-supply disruption and continuous volatility. This has also pushed up gold prices, a traditional haven in times of stress.