A relief news is coming for the investors troubled by the ongoing slowdown and decline in the Indian Stock Market for the last several months. If you too were worried after seeing red marks in your portfolio, then the latest strategy report of domestic brokerage firm ICICI Securities has brought a big hope for you. According to the report, almost all the negative factors creating pressure on the market from September 2024 are now gradually ending. Strong macroeconomic conditions of the Indian economy, stock prices coming down to reasonable levels and selling by foreign investors stopping are indications that the stock market is now all set to pick up pace once again.
Big cut in prices of expensive shares
Since the beginning of this year, the benchmark index of the Indian stock market has fallen by about 9%. Not only this, Foreign Portfolio Investors (FPIs) withdrew a huge amount of net ₹ 2.73 lakh crore from the market till June 24, 2026. This huge fall may have scared common investors, but ICICI Securities believes that this correction has made the market safer and more attractive than before.
When the market was at its peak, its valuation (P/E Multiple) had reached 24 times, which has now come down to a very reasonable level of 18 times. This simply means that the shares which were very expensive earlier are now available at the right price. According to the brokerage firm, now there is no need for any external miracle for the market to rise, rather the possible growth of 14-15% in the profits of the companies will directly take the share prices higher.
AI stocks balloon around the world
For some time now, investors from all over the world were leaving the Indian market and investing money in stocks related to global Artificial Intelligence (AI) infrastructure. Due to this craze in the shares of big tech companies of Nasdaq and Korean AI companies, funds were flowing out of the Indian market.
Now this enthusiasm for AI seems to be cooling down globally. Volatility in stocks of big AI companies has increased, companies like SpaceX have seen price reversals after their IPOs, and investor fears are beginning to surface due to increasing debt and intense competition. However, due to the strong balance sheets of hyperscalers like Microsoft and Google, there is no danger of any major crash in the markets around the world, but with the craze for AI decreasing, it is now believed that the direction of foreign funds will again be towards emerging markets like India.
Fall in crude oil prices
The latest data coming from the Indian economy further strengthens the confidence of common investors. India’s GDP growth in the fourth quarter of the financial year 2026 has been 7.8%, in which the biggest contribution has been from Gross Fixed Capital Formation i.e. investment taking place in the country. Along with this, the current account of the country has also come in a position of surplus i.e. profit, which has been supported by strong services exports and remittances coming from abroad.
| economic indicators | current situation | Its direct impact on the market |
| Crude Oil | Below $80 per barrel | India’s import bill will decrease, possibility of rise in Nifty 50 |
| indian rupee | Below 95 against the dollar | Strengthening rupee will increase the confidence of foreign investors. |
| 10 year bond yield | below 6.9% | The cost of loans will reduce for companies |
Cheapness of crude oil has always been a lifeline for the Indian market (Nifty 50), because there is an inverse relationship between the two. Due to oil becoming cheaper, the country’s expenses will reduce and the profits of companies will increase. Due to the new steps of the Reserve Bank of India (RBI), it has become easier for foreign funds to come into the domestic debt market, due to which the all-round selling by foreign investors has now started to stop.
These things have to be kept in mind
This report of ICICI Securities makes it clear that the market balance is now leaning in favor of bullishness, but investors should not be completely worried. Some such risks have also been mentioned in the report which are very important to keep an eye on.
There is a possibility of El Nino weather becoming active in the year 2026, which may affect the rural economy and inflation. Apart from this, the possibility of further increase in interest rates by the US Federal Reserve (US Fed) later this year cannot be ruled out. If this happens, the movement of funds globally may be affected. Despite these selective risk factors, this could prove to be a great opportunity for investors to start long term wealth creation by gradually adding shares of good companies to the market.
Disclaimer: This article is for information only and should not be considered as investment advice in any way. TV9 Bharatvarsha advises its readers and viewers to consult their financial advisors before taking any money-related decisions.
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