Morgan Stanley made a big claim regarding Sensex
Sensex target 2026: The world’s leading brokerage house Morgan Stanley has made a prediction regarding the Indian stock market, which has filled enthusiasm among investors. The firm says that by December 2026, the Sensex can touch the level of 1,07,000 (one lakh seven thousand). This is not a small thing, but it shows that the Indian market is going to regain its old momentum in the coming years. This expectation has been expressed in Morgan Stanley’s latest ‘Strategy Outlook Report’. He believes that if the country’s economic policies and global conditions remain favourable, our benchmark index can make a strong jump of about 27 percent from the current level.
What is the ‘bull case’ of Rs 1,07,000?
Morgan Stanley It has given a probability of 30 percent for its biggest target, which is called ‘Bull Case’. This goal will not be achieved just like that, for this it is necessary for some important economic engines to run together.
- The first condition is that crude oil prices remain below $65 per barrel.
- Second, there should be a softening of the global trade war and a reversal in tariff related policies.
- Third and most importantly, the reflationary policies in the country should continue and the growth of the economy should continue.
If all these screws fall into place, then Morgan Stanley estimates that between 2025 and 2028, the earnings of the companies included in the Sensex will grow at the rate of 19 percent annually, which will provide tremendous support to the market.
How will your money grow?
Not just the bull case, Morgan Stanley has also given a very good target for the most probable ‘base-case’. This base-case has been given a probability of 50 percent. Under this, the brokerage firm believes that by the end of 2026 the Sensex will reach the level of 95,000, which is about 13 percent more than the current level. In this situation, there will be economic stability in the country, the government will keep the fiscal deficit under control, private sector investment will increase and the global growth rate will also remain stable.
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This also includes that RBI will soon increase liquidity in the market by reducing interest rates. Even in this base-case, companies’ earnings are expected to grow at an annual rate of 17 percent. At the same time, there is also a pessimistic ‘bear case’, where if oil crosses $100 or the market turns tough, the Sensex could fall to 76,000.
‘Policy revolution’ in India became the reason for the boom
Analysts at Morgan Stanley, whose team is headed by Ridham Desai and Nayant Parekh, are attributing this big change to India’s new and strong policies. He says that in the last 31 years, the performance of the Indian stock market was the worst compared to the emerging markets, but now this period is about to end and India will regain its shine. Desai has clearly said that the policy changes will lead to a strong improvement in nominal growth, which will reverse the slowdown in earnings seen over the last 12 months. They also point out that investment by foreign investors (FPIs) in the Indian market is at an all-time low, which indicates larger investments in the future. Additionally, steps like possible cut in interest rates and reduction in GST rates to boost consumption will further add momentum to the rally.
The biggest stake is on these sectors
In its portfolio strategy, Morgan Stanley has chosen sectors that are associated with domestic demand and bullishness. The firm has given ‘overweight’ i.e. more importance to Financial (banks etc.), Consumer Discretionary (companies making non-essential items like cars, clothes) and Industrial (companies related to infrastructure and industry). At the same time, sectors like energy, materials, utilities and healthcare have been given less priority. He clearly believes that in the coming time, only macro factors will drive the market, in such a situation, instead of choosing stocks, choosing the right sector will be more beneficial.