Your Money in 2020

Innovation in products will be the key factor, be it banking, mutual funds, insurance or loans

- Naveen Kumar

The year 2019 saw high volatility in stock markets but also the formation of a stable government. Towards the end of the year, the Sensex crossed the key level of 41,000, even though India registered its lowest quarterly growth in GDP in six years in the second quarter. As we end the year with bad news on the economic front, experts say things may become better in 2020. According to a Goldman Sachs report, Global Economic Analyst, the annual average global growth is likely to improve from 3.1 per cent in 2019 to 3.4 per cent in 2020. US GDP is predicted to repeat the performance of 2019 and grow 2.3 per cent. China may face a marginal decline from 6.1 per cent in 2019 to 5.8 per cent. However, things are projected to be significantly better for India with GDP growth likely to improve from 5.1 per cent in 2019 to 6.4 per cent in 2020.

In the personal finance space, too, you can expect a lot of positive changes. Here is how the year is likely to pan out.

Stock Markets

Stock market performance in 2019 was limited to gains in select large-cap stocks as returns from the mid-cap segment were subdued while the majority of small-cap stocks gave negative returns. While the economy registered one of the lowest quarterly GDP growth rates (4.5 per cent) in the second quarter of FY20, the indices kept climbing. This may appear to be misleading, but markets are known to run ahead of time, and many experts consider this an indication of revival. “Due to the prolonged on-ground slowdown and low confidence, we have seen a few stocks driving the Nifty higher. As growth becomes more broad-based and uncertainty recedes, returns would also become more dispersed,” says Shrey Loonker, Fund Manager, Value Strategy PMS, Motilal Oswal Asset Management.