Outlook of Indian Stock Market in 2025; Opportunities, Risks, All You Need to Know

The Indian stock market remained resilient for the major part of 2024 despite challenges posed by soaring inflation, weak Q2 earnings, general elections outcome, Reserve Bank of India’s (RBI) unchanged policy stance and uncertain weather conditions.

Moreover, at a global level, the equity benchmark indices also performed strongly amid uncertainty over US Presidential elections, geopolitical conflicts in West Asia and China’s economic stimulus.

As the new year approaches, let’s have a look at the opportunities that investors have in 2025. Here’s what the brokerages have to say

1. JP Morgan

In the coming year, the world economy is expected to grapple with many challenges. While Emerging market (EM) equities are likely to report small gains in 2025, ongoing geopolitical conflicts and higher interest rates will stand the test of time.

2. Ashmore

Growth is expected to fall at 6.5% on account of soaring inflation, delays in public spending and tightening financing conditions. Following a four-year bull run, Indian equity indices have started to de-rate in the last three months. In the coming year, the central bank may look forward to reducing the interest rates if food inflation remains under control.

3. Morgan Stanley

In 2025, emerging market (EM) equities face several challenges, which include ongoing debt-deflationary challenges in China, the imposition of heavy tariffs by the Donald-Trump led administration and its faltering impacts on global currency exchanges. The brokerage has lowered its base-case price target to 1,100 from 1,160 for MSCI EM. While retaining its overweight stance on India, its most preferred markets are Singapore, Japan, Australia, South Africa and Malaysia.