After 14 months of poor performance, market values have slipped below their long-term average, according to JP Morgan analysts, even if they are still higher than those of other emerging markets (EMs).
Nifty 50 goal: International brokerage India's benchmark index could reach 30,000 by the end of the next year, according to JP Morgan, thanks to consistent monetary and fiscal policy that will probably boost demand.
The Nifty objective for 2026-end indicates an increase of more than 14% from Thursday's finish. After a 14-month hiatus, the index reached a new high of 26,310 today as macroeconomic data and domestic inflows continued to be strong and profit forecasts strengthened.
After 14 months of poor performance, market values have slipped below their long-term average, according to JP Morgan analysts, even if they are still higher than those of other emerging markets (EMs).
Despite an increase of more than 11%, India has notably underperformed its counterparts in Asia and emerging markets this year. Indian markets are lagging behind other markets due to a number of variables, including the dearth of AI stocks—the year's hottest trade—valuation issues, a slowdown in earnings, and FPI outflows.
HSBC and Goldman Sachs have even upgraded Indian stocks in recent months, leading many experts to feel that the tide may be shifting.
Why is JP Morgan optimistic about India?
According to the analysts, significant rate cuts by the central bank and the recent drop in inflation brought on by tax cuts should boost domestic demand.
In the future, JP Morgan predicts that the Reserve Bank of India (RBI) will lower interest rates by an additional 25 basis points in December. This would increase the impact of tax cuts, which are already boosting consumer spending, credit expansion, and auto sales. The RBI policy meeting is scheduled for December 3–5.
A possible trade agreement between the US and India could lead to a short-term re-rating, according to JP Morgan, which reaffirmed its preference for domestic-focused industries over exporters.
The experts think there is a "very high" chance of resolving the punishing US tariffs on India, with the extra 25% duty likely to be removed, given that India is growing its petroleum imports from the US while reducing its purchases from Russia.
They said that such a result would boost investor confidence, attract foreign investment, strengthen the rupee, and aid in the revival of IT and pharmaceutical stocks.
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