Axis AMC Forecasts Recovery for Indian Stocks, Driven by Steady Growth and Strong Earnings.

Indian stocks are potentially set for a rebound in the latter half of the financial year, driven primarily by resilient earnings and sustained economic growth, as indicated by a senior fund manager from Axis Asset Management. Despite a 12% decline in the Nifty 50 index during 2026, primarily due to elevated oil prices linked to geopolitical tensions and significant foreign outflows amounting to $31.3 billion, there are underlying factors that suggest a recovery may be on the horizon. The fund manager posits that India’s consistent growth rate exceeding 7% can improve investor sentiment and financial market performance.

While the current foreign investment landscape appears concerning, Relekar notes that these outflows reflect broader global financial dynamics such as crude oil prices and bond yields rather than intrinsic weaknesses in India’s economic framework. Notably, domestic capital flows remain robust, emphasizing a trend toward the financialization of household savings, with many households still heavily invested in fixed deposits. This continued domestic commitment indicates a potential cushion against global market volatility.

Relekar is optimistic about certain sectors and themes, particularly those associated with AI-driven capital expenditure, energy transitions, and domestic manufacturing. He specifically highlights opportunities within the private banking and non-bank financial sectors, citing their attractive valuations and stable earnings trajectories. As companies gradually adjust their earnings to mitigate the impact of global pressures, the risk-reward profile appears more favorable compared to the previous year, suggesting a strong potential for market recovery.

Source: The Economic Times

(Expert Note: This intelligence brief was structured and verified by the Wealthova editorial desk.)