New Delhi: Nifty of National Stock Exchange (NSE) may swing between -11 percent and +4 percent from its year-end target of 25,000, as markets navigate a range of evolving macro risks, including potential trade tariffs, shifts in the US economic outlook, and central bank policy actions by the Fed and RBI, BofA Securities said in a report.
BofA points to several key risks clouding the market outlook—including potential US trade tariffs on Indian goods, a cloudy US macroeconomic scenario, delayed or insufficient fiscal and monetary policy responses, and the implications of state elections across six major Indian states, which together account for over 16 percent of India’s public subsidy and capex spending.
“We keep our Nifty year-end target intact at 25k but expect Nifty to swing -11% to 4% vs. this target, as markets react to emerging developments around key factors such as trade tariffs, the US economic outlook, FED/RBI cuts, potential policy/fiscal support to offset tariff impact, etc.,” the report added.
The firm expects Nifty earnings growth to remain subdued, projecting 7 percent growth in FY26 and 11 percent in FY27, well below the Street’s expectations of 9 percent and 15 percent, respectively. Each earnings season, it warns, could bring corrections rather than sustained rallies.
The firm sees a potential upside if India implements some timely legislative and fiscal reforms, possibly funded by higher RBI dividends, asset sales, fuel duties, and leveraged capex projects.
According to publicly available market data, the Nifty at NSE and the BSE Sensex have not performed as expected, as both benchmarks have continued their worst losing streak in over two decades. Nifty 50 and Sensex have so far declined about three percent, contributing to cumulative drops of approximately 12.6 percent and 11.7 percent, respectively, from their all-time highs set in September last year.
