India has worst disconnect between stock rally, gloomy economy

Mismatch doesn't bode well for economy that's set for its first contraction in more than four decades, say analysts.

Of all the countries in the world, the disconnect between rallying global stocks and deteriorating data is probably the most pronounced in India.

The nation’s shares have logged the one of the best rebounds from the March lows globally while battling some of the world’s worst economic data. The surge has pushed up valuations to a record as investors look past the grim reality and the world’s third-highest tally in coronavirus cases.

The conundrum doesn’t bode well for Asia’s third-largest economy that’s set for its first contraction in more than four decades. Further negative surprises from macro data or virus