India's Market: Don't Write It Off, Says Analyst

Investors are advised against writing off the Indian market despite recent challenges, with a positive medium-term outlook anticipated. Market analysts suggest adjusting return expectations to a more realistic 12-14% annually, moving away from the previous years' over 20% gains. This caution comes even as major stock indices touched new all-time highs, closing flat and signaling potential resistance at elevated levels.

The Indian economy has faced headwinds, including significant tariffs imposed by the US, which have strained exports and weakened the rupee to historic lows. This, combined with high valuations, has diminished the attractiveness for foreign portfolio investors. While domestic investment has supported index performance, a substantial portion has been directed towards primary market issuances rather than secondary trading.

However, falling inflation levels are expected to pave the way for interest rate cuts by the Reserve Bank of India, potentially mirroring global trends. Private capital expenditure is predicted to see gradual improvement, supported by recent primary market proceeds. Experts emphasize focusing on earnings, balance sheets, and asset allocation, rather than just short-term market movements, for sustained investment success.