Global bull run leaves Dalal Street playing catch-up in 2025
2025 marked a year of sharp divergence in global markets, with overseas equities and precious metals delivering outsized returns, driven by easing financial conditions, strong earnings and risk appetite, while Indian benchmarks underperformed peers despite stable macro fundamentals.
Synopsis
2025 marked a year of sharp divergence in global markets, with overseas equities and precious metals delivering outsized returns, driven by easing financial conditions, strong earnings and risk appetite, while Indian benchmarks underperformed peers despite stable macro fundamentals.
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Global equity markets delivered strong and broad-based gains in 2025, led by the US, Asia and Europe, while Indian equities lagged with single-digit returns.
Global equity markets wrapped up 2025 on a strong note, delivering broad-based and outsized gains across regions, while Indian equities lagged peers with only single-digit returns. The year clearly belonged to overseas markets, where aggressive rallies were driven by easing financial conditions, strong corporate earnings and improving global risk appetite.
India’s benchmark indices ended the year with relatively muted performance. The Nifty 50 rose just over 10%, while the Sensex gained around 9%, placing Indian equities well behind most major global markets, according to data compiled by ET. Domestic headwinds, valuation concerns and intermittent risk-off phases kept returns capped despite stable macro fundamentals.
In sharp contrast, several global markets posted exceptional gains. South Korea emerged as the standout performer, with the KOSPI surging nearly 75% in 2025, buoyed by a powerful rebound in technology and semiconductor stocks, as per ET data.
Brazil’s Bovespa climbed over 34%, supported by strong commodity prices and improving fiscal confidence. Hong Kong’s Hang Seng rose close to 29%, while Japan’s Nikkei rallied more than 26%, reflecting renewed investor optimism around corporate reforms and earnings momentum, ET data revealed.
US equity markets also remained resilient and continued to outperform Indian benchmarks. The Nasdaq advanced over 22%, driven by sustained enthusiasm around artificial intelligence and technology spending. The S&P 500 gained nearly 18%, the Dow Jones rose about 14%, and the Russell 2000 added over 14%, underscoring the breadth of the US market rally, according to an Axis Direct report.