Equirus Securities’ annual India Equity Strategy report shows bullishness on large-cap stocks and eight sectors, including Auto, Capital Markets, Cement, FMCG, Infra, Internet platforms, NBFC, and Oil & Gas, while underweighting sectors such as Building Materials, Industrials, Defence, Real Estate, Textile, and Logistics.
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Indian equity markets are expected to open weak on Wednesday amid mixed signals from global markets. GIFT Nifty at 24,966 suggests that Nifty may open with a gap down of approximately 60 points.
Analysts expect the market to remain cautious and may move in a narrow range. All eyes are on the US Federal Reserve’s Jackson Hole Economic Policy Symposium later this week for further clues on US interest rate policy. Analysts expect stock-and-sector-specific action to continue.
Leading institutional equities brokerage Equirus Securities has released its annual India Equity Strategy report, in which it’s bullish on large caps and eight sectors, while remaining sanguine about five other sectors. According to the note, the Indian equity markets are benefiting from long-term growth tailwinds but are facing short-term valuation risks.
“Indian equity markets are entering FY26 with cyclical headwinds but strong structural drivers. We are Overweight on auto, Capital market, Cement, FMCG, Infra, Internet platforms, NBFC, Oil & Gas sectors while we are underweight on Building materials, Industrials & Defense, Real estate, Textile, Logistics sectors,” says Maulik Patel, Head of research Equirus Securities in the report.
The brokerage, which counts leading insurers, mutual funds, and FIIs as its clients, has a neutral stance on the Banks, Chemicals, Consumer Durables, EMS, IT Services, Metals and Mining, Healthcare, and retail sectors.
Nasdaq slumps
Hariprasad K, Founder – Livelong Wealth, said: Overnight, US tech stocks came under pressure as the recent AI-driven rally cooled. The Nasdaq fell 1.4 per cent, its biggest fall in weeks, as investors shifted focus to the Federal Reserve’s Jackson Hole symposium later this week. Powell’s speech will be key for the interest rate outlook, with markets expecting rate cuts this year. Adding further pressure, Japan’s exports fell 2.6% YoY in July, which is the sharpest drop in four years, dragging the Nikkei over 1% lower. Uncertainty around US–India trade negotiations also keeps exporters on edge.
F&O signal
The derivatives landscape aligns with the technical picture, as Put writers remain dominant by aggressively building their positions at the money (ATM). The 25,000 strike has witnessed heavy call writing, with open interest climbing to 1.25 crore contracts, making it a firm resistance point. On the flip side, the 24,900 strike holds the highest put OI at 1.19 crore contracts, acting as a solid support base, said Dhupesh Dhameja, Derivatives Research Analyst, SAMCO Securities. Interestingly, put writers are steadily shifting to higher strikes, while call writers are also inching upward — signalling a constructive undertone. “The Put-Call Ratio (PCR) has risen from 0.85 to 1.11, underlining the strengthening grip of put writers at current levels,” it said.
India VIX fell sharply by 4.46% to close at 11.79. “Despite lingering global headwinds, volatility remains subdued, reflecting expectations of consolidation rather than a steep correction. This indicates cautious optimism among market participants without evident signs of fear,” he added.
The broader market delivered weak earnings for Q1 FY26, although trends did not worsen significantly. We view this as the bottom of the cycle and expect a recovery from 2HFY26, led by the consumer discretionary sector. B2B sectors, such as Energy and Materials, held up this quarter, although we see consumption as the key delta factor going forward. We see a strong upside for Indian equities in the medium term, with a target of 28,000 for the Nifty by September 26.
Published on August 20, 2025
