Major domestic benchmarks have dropped roughly 12% to 13% in 2026, pressured by heavy foreign portfolio outflows alongside elevated bond yields and a strong U.S. dollar. Despite these headwinds, the Nifty's one-year forward valuation has compressed to 16.4 times, dipping beneath its long-term average multiple of 18.4 times. Record retail participation via systematic investment plans continues to absorb foreign selling, while potential catalysts such as concluding India–U.S. trade talks and upcoming budget spending could support a turnaround.
Key points
Brent crude retreating toward the $85 to $90 per barrel range represents a crucial cataly…: Brent crude retreating toward the $85 to $90 per barrel range represents a crucial catalyst for market recovery.
Brokerage firm Axis Direct recommends adopting a staggered investment approach focused ac…: Brokerage firm Axis Direct recommends adopting a staggered investment approach focused across a 12-month horizon.
Strong domestic institutional and retail inflows alone cannot drive a full rebound withou…: Strong domestic institutional and retail inflows alone cannot drive a full rebound without corporate earnings stabilization and foreign capital returns.
Sources checked by our analysis pipeline: 1
Stock market outlook: The year 2026 has remained proved to be a challenging year for the Indian stock market, marked by heightened volatility, intermittent recoveries and a significant correction in benchmark indices.
The Sensex and Nifty 50 have fallen around 12-13% so far in 2026, remaining under sustained pressure due to a mix of domestic and global factors. These include rising geopolitical tensions, elevated crude oil prices, increasing global bond yields, a strengthening US dollar and continued foreign institutional investor (FII) outflows.
According to Axis Direct, the market correction has improved the risk-reward in stocks, particularly where share prices have adjusted more sharply than the underlying business outlook. The Nifty is currently trading at 16.4x on a one year forward basis below its long-term average valuation multiple of 18.4x.
“We believe the appropriate response is neither indiscriminate buying after a correction nor a wholesale retreat from equities, but a measured approach that connects price paid with the quality and visibility of future earnings,” the brokerage firm said in its report titled as "Axis Diwali Mahurat Picks: SAMVAT 2083; Axis Securities”.
Investors responded positively to the retail firm's latest quarterly financial report, driving early morning buying interest across the exchange. The strong demand pushed trading values substantially higher than the prior session's close. This sharp upward movement marks an immediate market endorsement of the retail giant's recent operational performance.
The engineering infrastructure solutions provider is entering the public market backed by solid demand from non-institutional and institutional buyers. Net proceeds will primarily fund the firm's ongoing working capital needs and real estate acquisition for a manufacturing hub. This capital infusion supports operational expansion following substantial revenue and profit growth reported in the latest fiscal year.
Initial reports indicate an unauthorized actor has successfully drained massive reserves directly from the major cryptocurrency platform. The unprecedented breach represents one of the largest single security compromises recorded in the digital asset sector. Ongoing assessments are currently focused on determining the exact vulnerabilities exploited during the intrusion.