The Indian stock market mythos of 36 years is wrapped in a diaphanous negligee, lashed together by a delicate, etheric sash of 1.6 bull markets. To make money from here on will require a ground invasion, trench by trench, rather than carpet bombing. Way more difficult, points out Shankar Sharma.
'The bull market cycle ran for five years. It's the end of that cycle.' 'The next cycle is a down cycle, and in that down cycle, you will see the Sensex falling from their highs of around 68,000 to maybe 40,000-50,000 at the bottom of the cycle.'
'People become guided by emotions, fear of missing out, and greed. They tend to invest in booming sectors that may prove exceptionally expensive.' 'Typically, that represents the peak, and subsequently, they lose substantially.'
BAFs seek to offer a smoother experience across market cycles, not the full upside of a bull market.
'Every period of excessive optimism eventually gives way to a correction, while periods of extreme pessimism often create the best investment opportunities.'
The most important positive of India's stealth bull market is earnings growth across different sectors, explains Debashis Basu.
Notwithstanding the risk involved, analysts are upbeat on micro-cap investing as India remains in a firm bull market. Moreover, these stocks are available at relatively cheaper valuations compared to large, mid and small caps, assuring alpha returns. With a market-capitalisation (market-cap) of up to Rs 10,000 crore, micro-cap stocks are outside the purview of Nifty 500 stocks, and are ranked from 501 to 750 in the market-cap ladder.
Foreign investors have largely been exiting one part of the market while domestic investors have been enthusiastically accumulating another, points out Debashis Basu.
The rising market poses a dilemma for investors on whether to continue buying, reduce equity holding, or exit equities altogether.
Morgan Stanley analysts, led by Ridham Desai, predict that the next phase of the Indian market rally will be primarily driven by the April-June quarter (Q1FY27) corporate earnings season and the performance of the monsoon.
After the peak of the rally, the 'champion sectors' tend to underperform or perform in line with the market
Investors should cap gold allocation at 10-15 per cent and consider staggered purchases through gold ETFs.
"India's resilience (during the global financial crisis) has been recognised internationally. In my view, India may be beginning to see a multi-decade bull market," Jhunjhunwala said at a seminar organised by the Indian Institute of Foreign Trade in Mumbai.
A piece of slightly negative news can cause a serious setback, warns Debashis Basu.
'The market should maintain optimism on the back of range-bound oil prices, a robust fiscal balance sheet, a better-than-expected monsoon, and moderating inflation.'
Indian markets on Dalal Street rallied sharply as easing tensions in the US-Iran conflict and stable oil prices boosted sentiment. Track Nifty 50 and BSE Sensex performance and key global triggers.
'Mobius made EMs investable and India his most enduring belief.'
'If Covid peaks at around 250,000 cases, I don't see the market fall much. If it becomes uncontrollable and goes up to 600,000 a day, then the market may fall.'
'The real money in India over the coming period is likely to be made in small-cap stocks rather than in the large-cap benchmark names.'
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While Morgan Stanley believes individual stocks are in a bull phase, rate cuts, GDP growth revival are key.
Indian equity benchmark indices Sensex and Nifty experienced a significant tumble in early trade, with the Sensex tanking nearly 700 points, driven by uncertainty surrounding US-Iran negotiations, a fresh spike in crude oil prices, and persistent foreign fund outflows.
'Over the next 12 months, it will be difficult to make 15 to 20 per cent return in the markets as the valuations appear stretched.'
The bull-market in gold is not yet over and prices can rise to $6,200 an ounce (oz) by mid-2026, up nearly 25 per cent from current levels, according to UBS.
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The Sensex was around 18,600 by the end of August.
Trade deals ease risks for Indian equities, but weak demand and stretched valuations raise questions over whether optimism -- especially in smallcaps -- can turn into a sustained bull run, points out Debashis Basu.
Bull markets need a a charismatic leader and a fancy destination.
'The problem is not just slower growth, but also the quality of growth.'
Caution demands a sensible strategy even in bullish times.
The stock-market panic is not the only reason for rising investment demand.
The US Federal Reserve has decided to keep its stimulus programme intact and this in turn will lead to some respite for the battered emerging market economies, but it should also be borne in mind that tapering is inevitable in the medium term.
'Midcaps and smallcaps are the 'go-to segments' for retail investors.'
'The Rs 30,954 crore inflows recorded in May 2026 reflects around 16 per cent year-on-year rise.'
It is impossible for anyone to explain how markets are hitting record highs during an economic recession. It is both mysterious and surreal, notes Debashis Basu.
'A fund investor could pick, say, three of the top active funds in any given category.'
Algo strategies must be registered with stock exchanges.
Brokers like Vasudevan are struggling to keep themselves in tune with this super-informed, new-generation retail investor.
Investors can begin investing in mutual funds with as little as Rs 100.
'If an investor is ready to stay put for the next five years, one can consider investing in mid- and small-cap funds, but through SIPs.'
