MUMBAI— The Sensex could reach the historic 100,000 mark by July 2026 under a bullish scenario, according to a report released Monday by international brokerage firm Morgan Stanley.
The report assigns a 30 percent probability to the bull case scenario, which hinges on a combination of favorable conditions: a rate cut by the Reserve Bank of India (RBI), the rollback of global trade tariffs, persistently low oil prices (below $65 per barrel), and unexpected positive reforms by the Indian government.
Other potential growth catalysts include a finalized trade agreement with the United States, new capital expenditure announcements, faster loan growth, steady improvement in high-frequency economic indicators, and better trade relations with China.
Morgan Stanley also cited India’s strong population growth, stable democratic framework, macro-focused policy reforms, and ongoing infrastructure improvements as key drivers of long-term market gains.
Even under its base case scenario—which it believes has a 50 percent chance of occurring—the brokerage projects the Sensex will rise to 89,000 by July 2026. That outlook assumes strong domestic investment, macroeconomic stability, continued fiscal consolidation, moderate U.S. economic growth without a recession, and stable oil prices. A favorable U.S.-India trade agreement is also factored in.
However, the report outlines a bear case scenario, with a 20 percent likelihood, where the Sensex could fall to 70,000 by mid-2026. This downside risk is tied to a potential global economic slowdown, a U.S. recession, tighter monetary policy by the RBI, and a spike in crude oil prices above $100 per barrel.
Such a scenario would likely result in weaker earnings growth and valuation de-rating due to deteriorating macroeconomic fundamentals, the report warned. (Source: IANS)
