** India equities entering more supportive macro phase as policymakers pivot towards growth, liquidity support and easing financial conditions, Morgan Stanley says

** Brokerage flags rare combination of weak foreign positioning, inexpensive relative valuations and improving policy support, raising risk of sharp catch-up rally if growth surprises on upside

** Lower inflation volatility, fiscal consolidation and structurally lower real rates could support a re-rating in Indian equities, brokerage adds

** MS expects earnings momentum to improve over coming quarters as post-Covid hawkish macro stance unwinds via rate cuts, liquidity infusion and bank deregulation

** Says domestic cyclicals such as financials, consumer discretionary and industrials seen outperforming defensives as loan growth and capex recover

** YTD, Nifty 50 Index .NSEI down 2%, gained ~10% in 2025

(Reporting by Surbhi Misra in Bengaluru)

((Surbhi.Misra@thomsonreuters.com | X: https://twitter.com/SurbhiMisra_ |;))