Sensex reclaims 60,000 after 4 months- What should you do?

Sensex reclaims 60,000 as calls of a new bull run increase.

Sensex has risen in the last 2 months

The year 2022 started with high volatility for the stock markets. The tensions of the Russia-Ukraine war put pressure on the stock markets. Also, the persistent inflation and the subsequent increase of policy rates by central banks led to the weak performance of Sensex this year. The high selling by the Foreign Portfolio Investors (FPIs) kept the markets under pressure.

But in the last 2 months, the markets have recovered. The Sensex is up 17% in the last 2 months, as it has reclaimed the psychological level of 60,000 after 4 months. The confidence in the markets is despite the bad news related to China-Taiwan tensions. Now the FIIs have become net buyers in the markets, and oil prices have come down. Although inflationary concerns remain, the general consensus is that inflation has peaked.

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What should you do?

If you are a new investor, you can book some profits. But if you are a seasoned investor and have invested across market cycles, you can continue to invest in the markets. The faith in the equity markets should be maintained, but one should turn down his/her expectations. Investors should not expect double or triple-digit returns that they got in the last 2 years.

The volatility in the stock markets can return as the underlying inflationary concerns remain. Also, the slowdown in the US economy can cause more volatility in the markets. If the China-Taiwan situation deteriorates, the markets will not be spared. But despite this, the experts recommend maintaining your SIPs and continuing investment in the stock markets with a long-term perspective.

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Patience is the key

If you are retiring, you can take out the money from the stock markets and invest in debt funds to save yourself from market volatility. But if you have time on your side, you should continue to invest via monthly SIPs. The last 2 years were also unexpected for the markets, but if you were invested in the markets, you would have made the most out of it. It is difficult to time the markets, and patience is the key. As it is said, the time in the markets is more important than timing the markets. If it is a new bull run or not, we will get to know in the future. The correct strategy is to remain invested and benefit from the growth in India in the long term.

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