Nifty 50 may bounce toward 24,000, but foreign investors likely wait for peak US yields

what happened

Moody's, citing an interview with Mint, reports that Octanom Tech founder Rahul Ghose expects Nifty 50 to close the year in negative territory, with December likely stronger than October. He argues the index is oversold, so a sharp relief move toward 23,800–24,200 could come. Getting back into positive territory would require roughly 15% in ten weeks. The index stood at 22,888.95 on October 19, well below its solid 2025 close above 26,100.

Ghose says foreign portfolio investors respond to global borrowing costs and relative returns rather than India's growth, which he calls genuine: real GDP rose 7.8% in Q1 FY27. With the 10-year US Treasury yield above 5.2%, Indian equities carrying currency risk face a steep hurdle. Money rotating into AI-driven rallies in North Asia and a weaker rupee add to the pressure. Foreign portfolio outflows reached Rs 3.08 trillion this calendar year, close to twice the Rs 1.66 trillion withdrawn across 2025.

Oil is a key drag. The Indian crude basket averaged about $120 a barrel in October, while retail fuel prices have been unchanged since June. That squeezes oil marketing companies, the fiscal budget and margins in paints, chemicals, tyres and aviation. The RBI lifted its repo rate by 25 bps to 5.50%, its first increase since February 2023. Individual stocks may still gain on earnings beats, but oil limits how far the broader market can re-rate.

why it matters

For markets, the outlook hinges on two triggers: a credible easing of Hormuz tensions that pulls Brent below $90, and a peak in US yields. Ghose flags support at 22,000–22,300 and a close above 23,200 as necessary to signal a trend change. He sees a possible scrapping of the LTCG tax as a minor factor next to global rates, the rupee and oil.

market impact

Nifty 50 and INR: foreign outflows and high oil prices weigh on Indian equities

instruments