New Delhi, Nov 18 India's benchmark index Sensex is projected to touch 1,07,000 by December 2026, rising about 26 per cent from current levels, a report said on Tuesday, expounding its bull-case scenario with a 30 per cent probability.
US investment banker Morgan Stanley, in the report, also gave a base-case scenario projection in which it said Sensex will touch 95,000 with a 50 per cent probability.
The investment banker gave an update to its earlier projection after Indian markets delivered softer returns compared to emerging markets since 1994, the report.
Earlier, Morgan Stanley had predicted that the Sensex would hit the 1,00,000 mark by June 2026, to which they had attached a 30 per cent probability.
Analysts believe that relative valuations have corrected meaningfully and may have troughed in October 2025, adding that a positive growth surprise can be expected in the coming months that will support the market's re‑rating.
For the index to rally to its base case projection of 95,000 mark, the report projected continuation in gains in macro stability via fiscal consolidation, increased private investment, and a positive gap between real growth and real rates.
"In our base case, we anticipate a resolution to the tariff situation between India and the US in the weeks ahead. We use another 25 basis point (bps) reduction in short-term interest rates and a positive liquidity environment as the base case for monetary policy,” said Ridham Desai, managing director and chief India equity strategist, Morgan Stanley.
Desai, however, added that if crude oil prices surge past $100 a barrel mark, and the Reserve Bank of India (RBI) ends up with fiscal tightening measures along with the US slipping into recession, Sensex could slip to the 76,000 mark by December 2026. The report attached a 20 per cent probability to this scenario.
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