The Indian stock markets began 2026 on an optimistic note, with the Nifty 50 hitting a new lifetime peak at 26,328.55 and the BSE Sensex surging 573 points to close at 85,762.01 on January 2, 2026. The rally was powered by strong buying in power, banking, and metal stocks.
For the full year 2025, both benchmark indices delivered approximately 10% gains, with large-cap stocks outperforming their small-cap counterparts. The final trading session of 2025 on December 31 saw the Nifty comfortably close above 26,100, led by strong buying in Metal, PSU Bank, and Oil and Gas stocks.
While Foreign Institutional Investors (FIIs) remained net sellers, offloading equities worth Rs 3,268.60 crore on January 1, Domestic Institutional Investors (DIIs) provided crucial support by purchasing stocks worth Rs 1,525.89 crore. This domestic buying has been a key pillar supporting market resilience.
The auto index also hit a new all-time high at the end of December 2025 as major OEMs reported strong December sales figures. Force Motors reported a 49% jump in sales while Bajaj Auto recorded a 14% rise in total sales for the month.
Market experts expressed optimism for 2026, expecting decent double-digit growth driven by corporate profitability, increased government capital expenditure, strong consumption, low inflation, and healthy GDP growth. However, they cautioned that it may not be a runaway rally delivering above 15% returns.
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