After a quiet 2025, many investors are hoping the Indian stock market will bounce back in 2026.
What happened in 2025?
The Sensex and Nifty fell sharply early in the year after new U.S. tariffs, wiping out most of last year's gains. By the end of 2025 both indices had recovered and reached all‑time highs, but it took about 14 months to get back to the levels seen a year earlier.
Brokerage forecasts for 2026
- Morgan Stanley – Bull case: Sensex 107,000 (about +26%). Base case: Sensex 95,000 (+12%). Bear case: Sensex 76,000 (‑10%).
- Nomura – Nifty target 29,300 (+13%).
- Goldman Sachs – Nifty 29,000 (+12%) and upgraded India to “Overweight”.
- Kotak Securities – Bull case: Nifty 32,032 (+23.5%). Base case: Nifty 29,120 (+12%). Bear case: Nifty 26,208 (‑1%).
- Axis Securities – Base case: Nifty 28,100 (+8%). Bull case: Nifty 29,500 (+14%). Bear case: Nifty 24,000 (‑7%).
- Emkay Global – Nifty 29,000 (+12%). Overweight on Discretionary, Industrials, Healthcare and Materials.
- HSBC – Sensex 94,000 (+11%) and upgraded to “Overweight”.
Why brokers are more optimistic
Most analysts point to three main reasons:
- Macro tailwinds: Slower inflation, better monetary policy outlook and stronger government support.
- Valuation reset: After 14 months of underperformance, Indian stocks now trade at more reasonable multiples compared with global peers.
- Improving earnings: Companies are expected to see a rebound in profits as consumer spending picks up and global demand steadies.
Key themes to watch
- U.S.–India tariff negotiations – a positive outcome could boost sentiment.
- Reserve Bank of India policy – any rate cuts or liquidity measures may lift markets.
- Corporate earnings – especially in consumer discretionary, industrials and healthcare.
What this means for retail investors
If the median forecasts hold, the Sensex and Nifty could each gain around 12%‑15% by the end of 2026. This suggests a good entry point for long‑term investors, especially in sectors that are still undervalued.
Disclaimer
Remember, this is perspective, not prediction. Do your own research and consider your risk tolerance before making any investment decisions.