The Indian stock market, for the week of May 19–26, 2025, is expected to remain buoyant, with multiple sectors likely to emerge as frontrunners, backed by a mix of domestic demand resilience, global disruptions, strategic capex, and evolving investor sentiment. Sectoral rotation continues to play a pivotal role in shaping market trends, and this coming week offers several interesting narratives for both short- and medium-term investors.

The cement sector is drawing significant attention due to strong pricing discipline despite a sluggish demand environment. Q1 FY26 has already witnessed a 5% price increase across key markets. Market leaders like UltraTech Cement and JK Cement are being singled out by analysts as top picks. Their ability to maintain operating margins and deliver volume growth amid soft real estate activity highlights their operational efficiency and strategic positioning. With monsoons approaching and infrastructure activity likely to pick up post-elections, cement could be a steady compounder in portfolios.

The midcap private banking segment is also emerging as a strong bet. Fund managers and institutional investors are showing renewed confidence in mid-sized lenders due to cleaner balance sheets, expanding retail portfolios, and better provisioning levels. These banks offer a compelling risk-reward ratio, especially in a scenario where macroeconomic variables like interest rates and liquidity are expected to stabilize. Their nimbleness, regional focus, and digital banking push make them well-positioned to tap into India’s credit growth story.

In the chemicals sector, Indian manufacturers are being seen as beneficiaries of a shift in global supply chains. With continued disruptions in Europe’s chemical industry due to energy supply concerns and regulatory bottlenecks, Indian players are stepping in to fill the gap. This has opened up new export avenues and led to increased capacity utilization across specialty and bulk chemical companies. Firms with integrated capacities and global compliance certifications are particularly well-positioned to capitalize on this shift.

Meanwhile, sectors tied to infrastructure and capital expenditure, including real estate, oil & gas, and telecom, are expected to perform well on the back of government-led growth initiatives. India’s ongoing infrastructure transformation, with major investments in roads, housing, energy, and connectivity, is keeping demand for construction materials, industrial services, and utilities elevated. Brokerage houses remain overweight on these sectors, citing strong visibility on project pipelines, rising private investment, and fiscal support.

A relatively newer but fast-emerging theme is digital infrastructure, particularly data centers. India’s data center capacity is projected to double by 2026, driven by the exponential growth in digital services, cloud adoption, AI applications, and stringent data localization norms. Companies engaged in building, operating, or supplying to data centers—ranging from real estate developers to IT infrastructure providers—stand to gain meaningfully. The sector also attracts strong FDI interest, adding to its momentum.

As global markets continue to show mixed signals—European indices logging strong gains and US futures trading with modest upside—Indian markets may find external support. Domestically, investor mood will also be influenced by a packed earnings calendar, with Eicher Motors, Tata Power, Lupin, and Muthoot Finance among key names scheduled to announce quarterly results. Any earnings surprises or commentary on demand trends and margin outlook will be closely watched.

In summary, the coming week promises a dynamic interplay of sectoral themes, macro triggers, and earnings reactions, offering traders and investors alike an opportunity to reposition and strategize for potential upside.