Nifty To Remain Muted At 25,000? BofA Sees Shallow Returns — Key Factors Affecting Markets

BofA sees Indian markets delivering muted return in calendar year 2025. The brokerage kept the target for the benchmark index NSE Nifty 50 at 25,000 by the year end. According to the brokerage, the risk is skewed towards downside.

Markets are reacting to emerging developments around US tariffs, monetary and fiscal policies, it said in its India strategy note on Tuesday. Despite target of 25,000, BofA expects the index to swing between 11–4% by December. The upper band indicates a bull case scenario, while the lower implies a lower band scenario.

Long-term investors with buy and hold strategy will likely to moderating returns. Investors who are flexible to rotate sectors in search of alphas will see better returns, BofA said.

BofA has moved IT sector to Overweight from Underweight, utilities to Neutral-weight, after noticing their underperformance to the NSE Nifty 50 index. The sectors have delivered 23% and 6% underperformance compared to the benchmark large-cap gauge on a year-to-date basis.

BofA estimated negative returns from small and mid-caps. However, it sees opportunity of good returns from materials, auto components, and travel and tourism, the note said.