Asset X | October 2026: Key Signals Across Asset Classes

Markets this month are balancing solid domestic fundamentals against a restless global backdrop. Indian earnings and growth indicators remain strong with valuations near end-March lows, yet elevated crude, rising bond yields and a possible RBI rate hike keep risks on the table for equities, debt and the rupee.

In this edition, AssetX tracks the signals across equities, fixed income, commodities, alternates and the rupee, so your investment strategy stays on point.

Equities

Domestic Equities: Earnings, high frequency indicators and growth continue to be strong, while the global macroeconomic uncertainties continue to linger. Valuations remain attractive and near end March lows. We remain constructive on domestic equities and continue to favour one-shot deployment. Large Cap-to-SMID allocation remains at 60:40, with a very modest preference for SMIDs. Within sectors, we remain bullish on Nifty Metals and Financial Services. However, the ongoing geopolitical risks, elevated crude, global bond sell-off pose as downside risks for equities.

Global Equities have been volatile in the recent period as Fed’s decision to hike rates, elevated bond yields, sustained geopolitical tensions and questions over ROI of the AI-driven capex cycle have weighed on investor sentiment. US markets witnessed increased large caps while selectively still choosing cyclicals like semis. We had recommended adding portfolio stabilizers to manage any future volatility, and we continue to favour that. New allocations can be considered through a well-diversified mix of developed markets, including the US, and select emerging markets outside India.

Fixed Income & Commodities

Domestic debt markets: Bond yields remain elevated, tracking the rise in US Treasury yields alongside increased expectations of further rate hikes in both the US and India. Continued FPI selling in September has added further pressure on yields. With the RBI potentially delivering a rate hike as early as the October policy meeting, we favour keeping portfolio modified duration between 3Y-5Y.

In Commodities, we remain constructive on gold, supported by strong structural fundamentals, however, near-term headwinds remain. One-shot allocation into gold ETFs can be considered.

Alternates

Rapid advances in AI, space and defence technologies continue to drive investor interest across Unlisted Equities, including deep-tech PE and VC. However, recent IPOs listing below pre-IPO valuations have tempered appetite for late-stage private deals. The preference is shifting towards companies still two to three years from listing, where entry valuations and risk-return trade-off may be more reasonable.

Commercial Real Estate see a steady growth path with Bangalore, Delhi NCR & Mumbai markets leading the charge.

Currency

INR after being supported by a deluge of inflows through FCNR deposits, renewed tensions in the middle-east has kept the rupee under pressure. We expect the INR to remain range-bound within 92–98/USD.

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AssetX brings you facts and data that cut through market noise. We highlight the most important signals across major asset classes in the global financial markets, so your investment strategy always stays on point.

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This communication is for informational purposes only and does not constitute investment advice. Please refer to the full disclaimer in the Asset X report dated October 5th, 2026.