New Delhi, 30 December. The Indian stock market is expected to remain strong in 2026. The country’s economy will benefit from robust domestic demand, low inflation, good crop yields, and increased household wealth due to rising gold prices.
A report released on Tuesday by Bajaj Finserv Asset Management Limited stated that government tax decisions and the Reserve Bank of India’s (RBI) accommodative interest rate policies may lead to improved corporate earnings. This is likely to support a gradual economic recovery.
The report highlighted that sectors linked to the domestic market, such as automobiles and consumer goods, could see growth. Additionally, reduced uncertainty around taxes and tariffs, along with a stable rupee, may boost exports.
According to the report, 2025 witnessed significant market volatility caused by changes in global trade tariffs, international tensions, and foreign investors withdrawing funds. Despite these challenges, the Indian market remained resilient due to a strong domestic economic position.
Large-cap stocks provided stability to the market, while mid-cap stocks delivered around 5 percent returns. Small-cap stocks experienced a decline of nearly 8 percent. Investors showed a preference for companies with strong balance sheets and reliable earnings.
After a market dip in September 2025, different sectors performed well every two to three months. The automobile sector gained approximately 21.7 percent. Tax relief, reduced duties, and festive demand also benefited the consumer sector.
However, export-related sectors lagged. The IT services sector faced tariff uncertainties and other challenges, leading to a drop of about 13.7 percent.
The report noted that the Nifty 50 index gave nearly 9 percent returns in 2025 amid high volatility and market fears. The India VIX, which measures market risk, crossed 20 points six times between January and May, reaching 22.79 in April.
Another recent report from Standard Chartered Bank indicated that economic improvement, expected growth in corporate earnings, and the return of foreign investors could strengthen the stock market further by 2026.
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My name is Bhupendra Singh Chundawat. I am an experienced content writer with several years of expertise in the field. Currently, I contribute to Daily Kiran, creating engaging and informative content across a variety of categories including technology, health, travel, education, and automobiles. My goal is to deliver accurate, insightful, and captivating information through my words to help readers stay informed and empowered.
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