Indian equities could remain under pressure for another one or two quarters as high crude prices, elevated US bond yields, geopolitical risks and continued supply of shares weigh on investor sentiment, according to Mickey Doshi, India Country Head at UBS India.
However, Doshi remains optimistic about corporate earnings and expects the outlook to improve going into 2027.“The mood is not overly optimistic. I've been here three decades, and we've had cycles like this in the past also.” Doshi said the combination of geopolitical risks, oil prices and the supply of paper remains a concern, even as the market continues to absorb new share supply.

Despite the weak market environment, Doshi sees signs of improvement in corporate earnings. He said the April-June quarter of 2026 was showing signs of improvement before the war in February disrupted the trend. “I actually am, again, maybe the eternal optimist that I am, I do see corporates earnings may not be the 25-30% growth, but I don't think it's also that negative, right?”Doshi believes the earnings recovery could support a better market environment going into 2027.
He also noted that foreign investors' lack of interest in India is visible in the market and IPO activity, but does not necessarily indicate that global investors have lost faith in the country. A major concern remains the sharp rise in US bond yields.

The US 10-year and 30-year yields are at levels not seen in decades, and Doshi said the global equity market response so far calls for “cautious optimism.” Higher interest rates could continue to slow flows into equities and remain a key risk for markets.
At the same time, Doshi believes India's initial public offering pipeline could help attract fresh global capital. Large offerings such as NSE and Jio, he said, could bring new international investors into the market rather than simply absorb existing liquidity.

He sees the NSE listing as a reflection of India's growth and another way for global investors to participate in that growth. Doshi is also constructive on financials, particularly well-run private banks. While investors are watching leadership transitions at some large private lenders, he believes the underlying fundamentals remain strong, with asset quality in good shape.
Watch the full conversation hereHe is also optimistic that the money raised through Foreign Currency Non-Resident deposits could eventually flow into markets and productive uses. After a period of underperformance, Doshi expects financials to benefit as the cycle turns, particularly given the stronger balance sheets and asset quality of India's well-run banks.

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