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Informist, Thursday, Nov. 27, 2025

By Gopika Balasubramanium

MUMBAI – Even as the sentiment in the market is positive, India's headline indices are likely to take a breather in the near term after hitting record highs. Some analysts expect the indices to rise further and hit new record highs. Investors will likely track India's GDP data, due Friday at 1600 IST, and the Reserve Bank of India's Monetary Policy Committee meeting, due next  week. Another near-term positive trigger would be an announcement over a trade deal between India and the US. 

The Nifty 50 faced supply pressure near the 26300 points, its crucial resistance level where traders booked profits after the recent rally, causing the index to give up gains, Bhavya Shah, a technical analyst at StoxBox said. Shah is cautiously bullish on the market for the near term and said chart suggested a consolidation after these gains.

"I expect minor profit booking or consolidation in the initial days of the December (derivatives) series, he added. If the Nifty 50 sustains above 26300, there could be a swift move towards 26500, he said. "Any dip towards 26050–26100 should be viewed as a buying opportunity," Shah said. "The trend remains intact as long as the Nifty 50 holds above the 25800 support level," he added.

Technical analysts are divided on how the indices will move in the near term. While some analysts expect some profit-booking, others expect the indices to continue rising. Some analysts said the traders would likely take a buy-on-dips approach in the near-term. The Nifty 50 closed Wednesday's session at 26215.55 points, up 10.25 points. The BSE Sensex closed at 85720.38 points, up 110.87 points or 0.1%.
 

At 26310.45 points, the Nifty 50 hit its record high during Thursday's session, after nearly 14 months of consolidation. Analysts said the underperformance of the 50-stock index has likely come to an end and expect it to gain swiftly in the coming months, especially with expecatations of a recovery of earnings growth in the second half of 2025-26 (Apr-Mar) and a better FY27.

The 50-stock index has declined till February mainly due to concern over expensive valuations after it had hit the previous record high of 26277.35 points. After which, the index was largely range-bound till June. However, in April, the index fell to a low of 21743.65 points, especially on the back of uncertainty on US tariffs, slowdown in earnings growth, higher crude oil prices, and a sell-off by foreign investors to name a few. In September and October, there was consolidation and the index inched up. 

Currently, the delay in the India-US trade deal is a concern for the market participants, some analysts said. Others said that the market has priced in the impact of the trade deal. Since India is largely a consumption-driven economy and exports account for only a minor part, the impact is not expected to be strong, even on overall earnings, analysts said. That said, sector-specific impacts are huge, especially for textile, gems and jewellery, and seafood companies, they added. Analysts said diversification by geography over time would help these companies sustain their profitability.    

On the earnings front, analysts expect the December quarter to see a strong rebound, especially with the interest rate cut, lower goods and services tax, better monsoon, robust rural demand, improving urban demand, and ample liquidity. In the September quarter, the net profit of Nifty 50 companies grew 1.6% on year. The dismal performance was due to banks as they priced in the repo rate cuts that the RBI front loaded in 2025 and Tata Motors Passenger Vehicles, which incurred a sizeable one-time loss. Analysts expect the cumulative net profit of Nifty 50 companies to grow in double digits. The consensus is that the earnings downgrades have bottomed out and there will be several re-ratings in the upcoming quarters.

While the sell-off by foreign investors has been a concern for some time now, some analysts see the inflow of cash from domestic investors to offset this impact. After briefly turning into net buyers in April, the foreign investors net sold till October. The sell-off was worse in August with the foreign investors selling INR 83.12 billion worth of domestic equities. This sell-off was after the US President's punitive 50% tariff came into effect coupled with earnings slowdown worries. 

Wednesday, strategists at JP Morgan raised the base-case target of the Nifty 50 index to 30000 points by the end of 2026, ETNow reported. The brokerage had forecast the cumulative net profit of MSCI India companies at 13% in 2026 and 14% in 2027. While the valuations were still at a premium, JP Morgan noted that it had narrowed down below the long-term average compared with the emerging markets. The brokerage said the valuations are backed by strong fundamentals and resilient domestic inflows. On the US-India trade deal, the brokerage said a resolution could trigger re-rating. Last week, HSBC had said that Indian equities offer value when compared with China.   

In the last few weeks, many broking firms have given 2026 targets for the benchmark equities and said that these indices are poised for robust upside. Goldman Sachs had forecast the Nifty 50 to hit 29000 points at the end of 2026 and Emkay Global Financial Services maintained its target for Nifty 50 at 28000 points by September end. For the BSE Sensex, Morgan Stanley expects the index to hit 95000 points in its base case scenario. HSBC Global expects the 30-stock index to jump to 94000 points by 2026-end.  End

Edited by Akul Nishant Akhoury

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