Share Market News / HSBC is confident in the Indian market, Sensex may reach the level of 94000

Share Market News: India's stock market has performed dismally in recent days, buffeted by global trade wars. US President Donald Trump's aggressive policies have dealt a series of blows to the Indian economy, the impact of which is directly visible on the stock market. First, a 25 percent tariff was imposed, labeling India a "tariff king." Then, an additional 25 percent burden was imposed, labeling oil purchases from Russia as "fuel for the war machine." This total resulted in a 50 percent tariff. Furthermore, attempts to incite the European Union against India, and now the announcement of an annual H-1B visa fee increase to $100,000 (approximately Rs. 8.4 million). This move will have the greatest impact on Indian IT companies and professionals, as more than 70 percent of H-1B visa holders are Indian.

Due to all this, the stock market has been under pressure for the past three days. Selling by foreign institutional investors (FIIs) has further pushed the market down. On September 23, the Sensex closed at 82,102 points, down 0.07 percent from the previous session. By 1 pm on September 24, the Sensex was trading at 81,894.55, down 200 points, having seen a massive 500-point decline during the session. The Nifty 50 also hovered around 25,085, down 0.35 percent. The rupee also reached a record low of 88.75 per dollar.

The Trump administration's decision to increase H-1B visa fees, which applies to new applicants and not existing visa holders, took effect on September 21. However, its impact was immediate: shares of IT firms like TCS, Infosys, and Wipro fell. The Indian government has described it as a policy with "humanitarian consequences," while the opposition has accused Prime Minister Narendra Modi of adopting a "weak stance." This move could further hurt Indian exports amid trade negotiations, where 50 percent tariffs are already estimated to cause losses of ₹2.17 lakh crore in 10 sectors.

HSBC Report: Market Expectations for a Boom

In this environment, HSBC, the world's leading research firm, has given positive signals for the Indian stock market. In its latest report, "Asia Equity Insights Quarterly," HSBC has upgraded India's rating from "Neutral" to "Overweight." According to the report, attractive valuations, the government's reform policies, and strong participation from domestic investors could lead to a market recovery. The Sensex target has been set at 94,000 by the end of 2026, a 13-15 percent increase from current levels. The target for the end of 2025 remains at 85,130.

HSBC believes that foreign investors withdrew heavily from the Indian market over the past year (₹1.80 lakh crore so far in 2025), but domestic institutional investors (DIIs) supported the market with purchases worth ₹27,147 crore. Equity markets in the Asia Pacific region grew 20 percent annually, largely driven by retail investors. Earnings are expected to grow 12 percent (with a potential of 8-9 percent) for 2025 and 15 percent for 2026, but ROE may increase from 14.4 percent to 14.9 percent.

The report states that India remained relatively calm amid turmoil in Asian markets like Korea and Taiwan. Government reforms, such as a focus on capital expenditure, provided a strong foundation for the economy. While earnings may decline slightly, investor confidence and policy support will not pose a major obstacle.

Other Asian Markets: China-Hong Kong Strong, Korea-ASEAN Weak

India now leads HSBC's regional strategy and is among the top overweight options in Asia. China and Hong Kong also remain in the "overweight" category, with projected returns of 21 percent for FTSE China and 16.4 percent for FTSE Hong Kong by 2026. Mainland Chinese investors invested $140 billion in Hong Kong, double the three-year average.

On the other hand, Korea has been downgraded to "underweight" as market upside remains limited despite corporate governance reforms. Japan is benefiting from a weak yen but is now under pressure. Markets in ASEAN countries are sluggish due to political uncertainties, which have lowered investor confidence. Overall, Asian markets are up 20 percent in 2025, but uncertainty remains.

The Indian Market's Long Journey: Strength Despite Volatility

The current state of the Indian stock market is volatile, but it continues to provide investors with confidence in the long term. The Sensex has gained 5 percent so far in 2025, lagging behind the MSCI Asia ex Japan (23 percent). Over the past six months, the Sensex has gained more than 5 percent, while it has declined 3.50 percent for the year. However, from a five-year perspective, the Sensex has delivered a robust return of 119 percent.

Experts say Trump's policies will create short-term pressure, but India's domestic demand, government spending, and digital economy will remain the engines of growth. The HSBC report offers investors a message of cautious optimism: signs of recovery after the decline are strong. Will this take the market to new heights? The coming months will tell.

(Disclaimer: This article is for informational purposes only. Seek expert advice before investing.)