Market Outlook, Early November 2025

As November unfolds, the Indian equity market stands at a critical juncture shaped by robust domestic consumption, evolving global trade dynamics, and monetary policy steadiness amid geopolitical challenges. This month’s market trajectory will largely depend on macroeconomic data releases, Q2FY26 corporate earnings, trade negotiations, and RBI’s calibrated monetary stance.

RBI Monetary Policy: Supporting Growth with Stability

In its latest Monetary Policy Committee (MPC) meeting, concluding in October, the Reserve Bank of India maintained the repo rate at 5.50%, signaling a neutral stance that balances growth support and inflation control. The MPC highlighted resilient domestic demand with GDP growth for FY 2025-26 projected at 6.8%, an upward revision from the earlier 6.5%. The RBI underscored strong consumption, investment, government spending, and better credit flow as pillars sustaining the economy.​

Liquidity conditions remain comfortable, with the bank rate steady at 5.75% and standing deposit facility at 5.25%. RBI’s recent launch of inflation expectation surveys points to heightened monitoring amid global uncertainties around commodity prices and currency volatility.​

Earnings Season: Mixed Signals but Positive Lean

The Q2FY26 results season is gathering pace with over 600 companies reporting. Early trends indicate revenue growth of around 5.4% YoY and net profit growth outpacing at 12.6%, reflecting operational efficiencies and moderation in input cost inflation.

BFSI (Banking, Financial Services, and Insurance) sector has shown steady expansion, with BFSI revenue increasing by 8.1%, signaling steady corporate demand and digital transformation trends.​

Auto and consumption: where the action is

October 2025 auto sales in India hit unprecedented levels, buoyed by the dual festivals of Dussehra and Diwali alongside significant GST rate reductions under GST 2.0 reforms. Passenger vehicle sales reached a record 4.7 lakh units, marking a 17% increase YoY, with top players Maruti Suzuki, Tata Motors, and Mahindra seeing all-time highs in monthly dispatches. Maruti Suzuki’s sales rose 10.5% YoY to 1,76,318 units; Tata Motors grew 27% to 61,134 units; and Mahindra logged its highest-ever SUV sales with 71,624 units.​

Two-wheeler sales also surged by 14.2% YoY to 21.6 lakh units, driven by robust scooter and motorcycle demand domestically and export growth of 22.4%. This performance underscores sustained rural and semi-urban consumption strength amid rising disposable incomes and increased financing availability.​

Credit growth: Stable but cautious

Bank credit in India expanded 11.4% YoY as of October 2025, supported by continued festive demand and the stimulus effects of GST cuts in housing, autos, and consumer goods sectors. Though this growth rate is slightly tempered compared to last year’s 14.1%, it signals a healthy appetite for credit across retail and corporate segments. Deposits grew 9.9%, bringing the credit-to-deposit ratio to 79.9%, reflecting cautious but balanced banking sector liquidity. Short-term call rates have eased somewhat below the RBI repo rate of 5.5%, aiding smoother cost of funds for lenders.​

Global headwinds: Trade, Tariffs and Inflation abroad

A major development impacting Indian exports is the ongoing India–US trade negotiations, with the first tranche of an anticipated trade deal slated for finalization in November 2025. Both governments express optimism about unlocking full bilateral potential despite current tensions. However, the continuation of 50% tariffs on several Indian exports imposed by the US under Section 232 and 301, including textiles, gems, and leather, weighs on sectors contributing over half of the USD 87 billion export value to the US. Key exemptions remain for pharma and semiconductors, but overall elevated tariffs are estimated to negatively impact India’s GDP by 0.3-0.5%, potentially reducing shipments by USD 4-5 billion.​

Globally, November will see critical macroeconomic data releases, including US inflation (CPI, PPI) and employment figures, China’s Loan Prime Rate decision, Eurozone PMI, and OPEC+ production meetings, which will rebound through commodity prices and risk sentiment. The global central bank environment remains tenuous with cautious easing policies being tested for sustainability without rekindling inflation.​

Outlook: 

India’s strong Q2 corporate earnings growth, resilient consumption, record auto sales, and healthy credit expansion provide a solid domestic foundation. RBI’s steady monetary policy stance offers predictable interest rates supporting investment and spending. However, trade uncertainties, currency pressures, and global inflation risks mandate prudent investor positioning.

Key sectors to watch include BFSI benefiting from credit growth, consumer discretionary boosted by festive spending, and autos capitalizing on record sales and demand momentum. Export-oriented sectors face challenges from tariffs but present opportunities if the trade deal materializes.

To sum up, November 2025 could be a defining month where India’s resilience meets global uncertainty. Investors should lean into quality growth businesses while staying alert to policy signals and global macro shifts. Use this to refine your portfolio by strengthening your roots (solid companies) and giving wings to the ones positioned for growth.