Stock Market: Important Period for Investors to Focus on Long-Term Opportunity
Despite the short-term sell-off, market experts believe that the combination of strong macro fundamentals, robust earnings growth, and attractive valuations presents an important period for investors to focus on long-term opportunities rather than immediate market volatility.
New Delhi: Despite the short-term sell-off, market experts believe that the combination of strong macro fundamentals, robust earnings growth, and attractive valuations presents an important period for investors to focus on long-term opportunities rather than immediate market volatility.
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Stable Macro Conditions
On the macro front, conditions remain stable. Fiscal deficits are under control, tax cuts are expected to boost consumption, inflation is low at 4.31%, and rate cuts have already started, which should support economic growth.
“Domestic investors continue to pump money into mutual funds, offsetting some of the foreign selling pressure. While it is impossible to predict an exact market bottom, excessive negativity often signals a turning point,” said Krishna Appala at Capitalmind Research.
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GDP Growth and Economic Performance
India’s GDP growth accelerated to 6.2% in the third quarter (October-December) of 2024-25, up from a revised figure of 5.6% in the second quarter. The GDP growth rate for the financial year 2024-25 is now estimated at 6.5%, while the economic growth rate for 2023-24 has been revised to a 12-year high of 8.2%.
India’s Q3 FY25 GDP data met expectations, with a slight upward revision to 6.5% for the fiscal year, according to experts. The agriculture sector posted steady growth in Q3, suggesting a likely improvement in the kharif crop, which could support rural consumption.
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Investor Focus on Key Events and Recovery
“Investors will be closely watching key upcoming events, including the tariff policy, U.S. Core PCE Price Index, and jobless claims. In the near term, market conditions are expected to remain weak, with a gradual recovery anticipated as earnings improve from Q1 FY26 and global trade policy uncertainties subside,” said Vinod Nair, Head of Research at Geojit Financial Services.
Experts emphasized that markets do not move in a single direction forever.
Positive Outlook for India’s Growth
A Morgan Stanley report highlights the confluence of favorable fiscal policies that support both capital expenditure (capex) and consumption, easing monetary policies across all its levers — rates, liquidity, and regulations — as well as robust services exports. These factors are likely to aid the growth momentum for India, contributing positively to the job market outlook.
