Nifty50 Expected to Rise Up to 6% in H2 2025 Amid Global Risks

Analysts expect Nifty to rise up to 6% in H2 2025, with intermittent corrections due to global factors. Domestic triggers for the markets include a strong macroeconomic environment, with the Nifty50 advancing 8.07% in H1-2025 and the Sensex rallying 7.4%.

Analysts are predicting a robust performance for the Nifty in the second half of 2025, with potential gains up to 6%. This outlook is based on a strong macroeconomic environment and favorable market conditions. The Nifty 50 has advanced by 8.07% in the first half of 2025, while the Sensex has rallied by 7.4%. These gains have been driven by a combination of domestic and global factors.

The domestic market has been buoyed by a strong macroeconomic environment, with key indicators such as GDP growth, inflation, and employment rates showing positive trends. Additionally, the Nifty has historically performed well in July, with positive returns in nine out of the last ten years [1]. The return of foreign institutional investors (FIIs) has further bolstered market confidence, with FIIs turning net buyers for the fourth consecutive month [1].

Technical indicators also suggest a bullish trend for the Nifty. The Nifty's internals are robust, with 82% of its stocks above the 10-DMA, 86% above the 20-DMA, and 78% above the 50-DMA [1]. The Bank Nifty has outperformed the Nifty 50 in most bullish Julys, delivering an average return of 8.6% in Q2 [1].

Beyond the domestic market, global factors are also supporting the Nifty's rally. The global backdrop is supportive, with easing geopolitical tensions in the Middle East and speculation around potential US Federal Reserve rate cuts as early as July. Additionally, the approaching first-quarter earnings season is providing additional fuel for optimism [1].

However, analysts caution that intermittent corrections could occur due to global factors. The market remains sensitive to geopolitical risks, trade tensions, and changes in monetary policy. Moreover, while the smallcap sector has shown signs of resurgence, caution remains due to stretched valuations and the need for earnings to catch up [2].

In conclusion, analysts are optimistic about the Nifty's performance in the second half of 2025, with potential gains up to 6%. However, they also caution that intermittent corrections could occur due to global factors.

References:
[1] https://m.economictimes.com/markets/stocks/news/julys-magic-touch-nifty-has-failed-only-once-in-last-10-years-will-history-repeat/articleshow/122151711.cms
[2] https://m.economictimes.com/markets/stocks/news/6000-point-sensex-rally-overshadows-markets-real-story-smallcaps-are-staging-a-revolt/articleshow/122151491.cms