Global investment bank Goldman Sachs has expressed renewed optimism about Indian equities, stating that foreign institutional investor (FII) selling is likely over and that there is significant room for overseas capital to return to the Indian market. In its latest India Strategy report for July, the firm said improving domestic economic conditions and relatively light foreign investor positioning are expected to support a gradual recovery in market sentiment.
Goldman Sachs expects the Nifty 50 index to reach 26,500 by June 2027, implying an upside of around 10 per cent from current levels. While the firm cautioned that geopolitical tensions in West Asia could continue to create short-term market volatility, it believes India’s long-term investment outlook remains favourable.
The latest assessment marks a notable shift from Goldman Sachs’ stance in May 2026, when it considered Indian equities less attractive than several North Asian markets and expected foreign investors to remain cautious. The investment bank had then cited concerns over artificial intelligence-driven disruptions and global market uncertainties.
According to Goldman Sachs, global investors sold a record 30 billion US dollars worth of Indian equities during the first half of 2026, using India as a funding market. However, foreign investors have turned modest net buyers since mid-June, bringing in approximately 2 billion US dollars, with financial stocks attracting the bulk of these inflows.
The report suggests that improving domestic fundamentals, easing foreign selling pressure, and renewed investor confidence could support the next phase of growth in India’s equity markets.
