Indian stock markets crashed on April 2, 2026, with the Sensex falling over 1,500 points and Nifty dropping 2 per cent after US President Donald Trump's warning of intensified attacks on Iran
Going ahead, analysts believe the probability of another year of relative underperformance remains high, unless earnings improve meaningfully, crude stabilises, and foreign flows return
Earlier in FY20, the benchmark Sensex tanked 23.8 per cent due to the outbreak of the Covid-19 pandemic, while the Nifty 50 crashed 26.03 per cent.
FIIs have turned cautious on Indian equities, selling ₹1.07 trillion amid Iran war risks. BNP Paribas flags oil, inflation, CAD and earnings concerns.
Foreign outflows, the West Asia conflict, rupee depreciation, uncertainty around US tariffs, and elevated valuations were among the key factors that influenced investor sentiment
Analysts expect FIIs to stay cautious on Indian equities in H1FY27 as global risks weigh. They, however, see flows returning in H2FY27. Strong DII inflows could also support Indian markets.
For FII's, the favored markets over last two years have been countries that were beneficiaries of new age tech and artificial intelligence (AI), he said.
Utsav Verma of Choice Institutional Equities said that long-term investors should deploy funds in a staggered manner in sectors with stronger earnings visibility
Strategy for 2026, he said, is shifting toward sectors with a probable growth visibility such as Banking, Consumer, Resources and Manufacturing.
In January 2026, mutual funds increased their exposure to domestic sectors such as services, cement, real estate, consumer services, financial services, and power & utilities
The correction in the tech pack has been driven by mounting concerns among investors over the potential impact of AI on the sector's growth outlook
The reduction in US tariffs and the interim trade deal framework are set to significantly boost India's export competitiveness, said Subhash C. Aggarwal
Jan'26 witnessed sharpest outflow of Rs333bn since Aug'25. FMCG, healthcare and consumer services saw highest outflows in Jan'26
The India-US trade deal, Antique believes, is significantly positive for Indian equities as FPI equity outflow of $34 billion since October 2024, the highest among emerging markets (EMs), may reverse
India's structural story (demographics, digitisation, manufacturing) is intact despite tactical noise, said Mehta
Our analysis over past two decades suggests Nifty sustains higher valuations only during periods of strong earnings growth/upgrades, which is unlikely next year, Shah said.
Sensex Today | Stock Market LIVE Updates, December 9, 2025: In the broader markets, the Nifty MidCap index was up 0.32 per cent, and the Nifty SmallCap index was up 1.14 per cent
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