Dalal Street Shows Resilience as Equity Markets Signal Recovery

Indian stock markets closed the week ending June 28, 2026, with modest gains, signaling a potential turnaround after several months of underperformance. The BSE Sensex added 297.57 points to reach 77,100, while the NSE Nifty moved to 24,056. This upward momentum follows an improvement in geopolitical stability and a reduction in crude oil prices, which traditionally eases cost pressures for domestic industries. Foreign institutional investors have begun selective buying, providing a counterbalance to the selling pressure observed earlier in June.

Analysts from ICICI Securities and JP Morgan note that domestic equities are becoming more attractive due to reasonable valuations and policy shifts. The current price-to-earnings ratio has moderated to around 18x, down from previous highs of 24x. Recent changes in capital gains taxation—now set at 12.5% for long-term equity—and the exclusion of indexation benefits for other assets have redirected investor capital toward the stock market. Growing participation through Systematic Investment Plans has emerged as a cornerstone of retail stability, offering a reliable buffer against periodic external market volatility.

Large-cap firms led the market gains this week, with ICICI Bank and HDFC Bank recording significant additions to their market valuations. Aditya Infotech continued its rally, reporting a 45.6% year-on-year increase in total income, though some analysts warn that its current valuation of 47x EV/Ebitda requires cautious monitoring. While indices have moved higher, risks such as potential El Nino weather patterns and shifting monetary policies from the US Federal Reserve remain on the horizon. Investors are advised to watch sector-specific tailwinds in renewable energy and IT as the capital expenditure cycle gains further momentum.