What factors influenced the Indian stock market's performance this year?

The market saw modest gains driven by domestic institutional investor buying, offset by foreign capital outflows and economic headwinds.

Why did foreign investors pull capital from the Indian stock market?

Foreign investors withdrew capital due to stretched earnings, a delayed trade deal, weak corporate earnings, and a weaker rupee.

Did the Indian stock market end the year with significant gains?

No, the Indian stock market ended the year with modest gains, as positive factors were balanced by considerable challenges.

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Indian Stocks: Mixed Signals End Year Strong

20 Dec, 2025

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Summary

Indian stock market ends year with modest gains.
DIIs show robust buying, supporting market growth.
Foreign capital outflows limit gains amid global concerns.

Indian Stocks: Mixed Signals End Year Strong

The Indian stock market has concluded the year with moderate gains, a result of balancing significant headwinds and tailwinds.

Robust buying activity from domestic institutional investors has been a key driver, supported by favorable growth and inflation conditions. This internal strength has helped maintain a positive trajectory for the market.

Conversely, the market faced considerable pressure from substantial foreign capital outflows. Factors such as stretched earnings valuations, a delayed India-US trade deal, and a weakening Indian rupee contributed to foreign investors pulling back, thereby capping the overall gains for the year.

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