Nifty Pharma and Other Sectors Reach 52-Week Highs Amid Market Turmoil
Nifty Pharma, 4 others hit 52-week high since Iran war while Nifty fell 7%. Will the form continue?
Image: The Economic Times
Despite a 7% decline in the Nifty50 index due to geopolitical tensions and economic pressures, five sectors, including Pharma and Defence, have achieved 52-week highs. Analysts attribute this resilience to structural growth drivers and strong earnings visibility, suggesting a potential for continued performance.
- 01Foreign institutional investors have sold over $22 billion in Indian equities in 2026, surpassing the previous year's outflow.
- 02The Indian pharma sector is benefiting from the 'China+1' strategy, with increasing domestic market growth and new profit opportunities.
- 03Defence stocks are experiencing a transformation driven by India's intent to enhance domestic capabilities and export potential.
- 04The energy sector is poised for growth, supported by rising demand from urbanization and data centers.
- 05Capital markets are seeing increased retail participation, with mutual fund assets rising significantly from ₹12 lakh crore in FY16 to nearly ₹82 lakh crore in April 2026.
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The ongoing Iran war and economic challenges, including high crude prices and significant foreign fund outflows, have led to a 7% decline in the Nifty50 index. However, five sectors—Pharma, Energy, Defence, Capital Markets, and Metals—have reached 52-week highs, showcasing resilience. Analysts highlight that this performance is driven not just by defensive strategies but by strong structural growth factors. The pharma sector benefits from a shift in supply chains away from China, while defence stocks are buoyed by India's commitment to domestic production and export capabilities. Energy demand is expected to rise significantly due to urbanization and the growth of data centers. Additionally, capital market stocks are thriving as retail participation increases, with mutual fund assets experiencing a substantial rise. Despite geopolitical uncertainties, the underlying fundamentals of these sectors suggest a potential for sustained growth, contingent on continued policy support and effective execution of strategies.
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The performance of these sectors could stabilize the Indian equity market amidst foreign fund outflows and geopolitical tensions.
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