Nifty 50 target: Global brokerage JP Morgan said India’s benchmark index could climb to 30,000 by the end of next year, powered by steady fiscal and monetary policy that are likely to fuel demand.
From Thursday’s close, the Nifty target for 2026-end signals an over 14% upside. The index hit a fresh high of 26,310 today after a gap of 14 months as earnings expectations improved while macroeconomic indicators and domestic inflows remained robust.
JP Morgan analysts said that while market valuations are still at a premium to other emerging markets (EMs), they have eased below their long-term average after 14 months of underperformance.
This year, India has significantly underperformed its Asian and emerging market peers despite an over 11% rise. A confluence of factors like lack of AI stocks — the hottest trade of the year, valuation woes, earnings slowdown and FPI outflows have kept Indian markets on the backfoot versus other markets.
However, many analysts believe the tide could be turning, with HSBC and Goldman Sachs even upgrading the Indian equities in the last few months.
What makes JP Morgan bullish on India?
The analysts said the recent tax cut-driven decline in inflation, coupled with sharp central bank rate cuts, is expected to strengthen domestic demand.
Going ahead, JP Morgan anticipates the Reserve Bank of India (RBI) to cut rates by another 25 basis points in December, further amplifying the boost from tax reductions that are already supporting consumption, credit growth and auto sales. The RBI policy meet is slated to take place on 3-5 December.
JP Morgan reiterated its preference for domestic-focused sectors over exporters, noting that a potential India-US trade deal could trigger a near-term re-rating.
With India increasing petroleum imports from the US while scaling back purchases from Russia, the analysts believe the likelihood of resolving the penal US tariffs on India is “very high,” with the additional 25% levy likely to be withdrawn.
Such an outcome, they said, would strengthen investor sentiment, draw foreign inflows, firm up the rupee and support a recovery in IT and pharma stocks.
(With inputs from Reuters)
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