Nifty 50 Posted Gains in 18 of the Last 25 Julys: Will the Bull Run Continue?

The Nifty 50 has historically performed well in July, raising hopes that the benchmark index could maintain its positive momentum this month. Data from the past 25 years shows the index has ended July with gains in 18 instances, giving it a success rate of 72 per cent. During the period from 2001 to 2025, the Nifty 50 delivered an average return of 2.19 per cent in July, making it the third-best performing month of the year after December and November.

According to Jahol Prajapati, Equity Research Analyst at SAMCO Securities, while July has consistently been a strong month for the market, investors should not rely solely on historical seasonality as a trading strategy. Instead, the trend reflects recurring factors such as the arrival of a normal monsoon, improving expectations around first-quarter corporate earnings and strong domestic liquidity, all of which have historically supported investor sentiment.

The year-wise performance highlights July's resilience despite occasional setbacks. The Nifty 50 declined 3.16 per cent in July 2001 and 9.35 per cent in 2002 before rebounding with gains of 4.56 per cent in 2003 and 8.42 per cent in 2004. It advanced 4.13 per cent in 2005 and added 0.48 per cent in 2006, followed by gains of 4.88 per cent in 2007, 7.24 per cent in 2008 and 8.05 per cent in 2009.

The benchmark continued to post positive returns of 1.04 per cent in 2010 before slipping 2.93 per cent in 2011, 0.95 per cent in 2012 and 1.72 per cent in 2013. It recovered with gains of 1.44 per cent in 2014, 1.96 per cent in 2015, 4.23 per cent in 2016, 5.84 per cent in 2017 and 5.99 per cent in 2018. Although the index declined 5.69 per cent in July 2019, it rebounded with gains of 7.49 per cent in 2020, 0.26 per cent in 2021, 8.73 per cent in 2022, 2.94 per cent in 2023 and 3.92 per cent in 2024 before falling 2.93 per cent in July 2025.

Beyond historical performance, current macroeconomic conditions also appear supportive for equities. Prajapati noted that crude oil prices have eased to around USD 72 per barrel amid softer geopolitical tensions and expectations of a possible U.S.-Iran agreement. Lower crude prices are expected to reduce inflationary pressures and ease input costs for businesses.

At the same time, the Indian rupee has shown signs of stability after a volatile start to the year, while foreign portfolio investor (FPI) selling has moderated. These developments have improved institutional flow dynamics and created a more favourable environment for Indian equities, provided global uncertainties remain under control.

Historical monthly data further reinforces July's strength. The Nifty 50 has recorded average losses of 0.47 per cent in January and 0.74 per cent in February, while March has also delivered a marginal average decline. Market returns typically improve from April onwards, with average gains of 1.94 per cent in April, 1.04 per cent in May and 1.25 per cent in June. July stands out with an average return of 2.19 per cent, followed by average gains of 1.12 per cent in August, 1.60 per cent in September and 1.10 per cent in October. November has historically generated an average return of 2.50 per cent, while December has been the strongest month with an average gain of 2.61 per cent.

While history favours the bulls in July, market participants should remember that historical trends do not guarantee future performance. Investors should consider broader economic developments, earnings growth and global market conditions before making investment decisions.

Disclaimer: The article is for informational purposes only and not investment advice.