Selling started in India's stock markets from the end of September. It has started again from the first day of the new year 2025. In January itself, there has been a sell-off of about Rs 19000 crore. Sensex and Nifty have fallen 10 percent from the upper level. In fact, the benchmark has been in the red since the beginning of this year. However, this is not unusual for investors. In seven of the last 10 years, the Nifty turned negative on the fifth trading day of the year.

However, this time it is different. Many analysts are concerned about high valuations in companies and the lack of earnings growth in companies in the new year.

Is the bad time over for the Indian stock market?  HSBC's equity research report says that the disappointment in the markets is likely to continue. The bank's Asia Pacific strategists, led by Harald van der Linde, said in a note to clients on Thursday, "Earnings are disappointing. Therefore, growth estimates for NIFTY 50 have been reduced from 15% to 5%." The investment bank downgraded Indian equities to neutral. Morgan Stanley reported that last year, for the first time in eight years, the stock market performed worse than bonds and gold (which performed better than most global markets). Ridham Desai of the investment bank said, "In the long run, we think the stock market will be at the top in financial assets and gold will shine in physical assets." Many also believe that Indian equities, after their long decline, are now ready to choose. Bernstein strategist Venugopal Gare wrote in a note to clients last week, India has entered a recession. Gare expects economic growth to pick up in the next three to six months. He said, it is advisable to invest before recovery. Bernstein expects the Nifty 50 to end the year at 26,500, up 13% from current levels. Morgan Stanley says the central government may reduce the fiscal deficit when it presents its budget in February, which could reduce bond yields and reduce borrowing costs for companies. The same outlook has also come in Citi's report. They expect the government to increase spending on infrastructure. Hence, 6.5% growth is possible in the Indian economy, which was in recession last year. Citi's Surendra Goyal said in a note to clients, our outlook is positive given the correct valuation of the market after recent reforms. The investment bank also expects the Nifty to end the year at 26,000 - up 10.5% from the previous week's close to clients. Economic growth is expected to pick up in the next three to six months and they are urging investors to invest before the change.