Markets in India were climbing for the fourth straight day on Friday, January 31, a day ahead of the presentation of the Budget 2025-26. The BSE Sensex ended 741 points, or 0.97 per cent, higher at 77,500.6 levels. The index touched an intra-day high of 77,606, over 800 points higher than its previous close.
Similarly, the 50-stock NSE Nifty50 closed 250 points, or 1.1 per cent higher, at 23,508. It touched an intra-day high of 23,547, around 300 points higher than its previous close.
On the 30-stock BSE Sensex, L&T was the top gainer, climbing by 4.3 per cent, followed by Nestle India, IndusInd Bank, Titan, Tata Motors, and Tata Steel. On the flip side, among the six declining stocks on the frontline index, ITC Hotels was the top drag, falling 3 per cent, followed by Bajaj Finserv, Bharti Airtel, ICICI Bank, Bajaj Finance, and Sun Pharma.
All the sectoral indices ended higher, led by Nifty FMCG, and Consumer Durables, which settled with gains of 2.04 per cent and 2.44 per cent, respectively. Among others, Nifty Auto, PSU Bank, Realty, Metal, OMCs, and select Financial Services indices ended higher by over 1 per cent each on Friday.
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Similarly, in the broader markets too, the BSE Midcap index was ahead by 1.89 per cent, and the BSE Smallcap index was higher by 2.11 per cent by close.
The market is buoyant in the run up to the Budget 2025-26, set to be presented by Finance Minister Nirmala Sitharaman on Saturday, February 1, 2025.
Moreover, the Economic Survey 2024-25, tabled on the first day of the Budget Session of the Indian Parliament on Friday, pegs India’s economy to grow between 6.3 per cent and 6.8 per cent in the financial year 2025-26 (FY26). TRACK LIVE UPDATES HERE
The estimates are in-line with forecasts made by international agencies such as the International Monetary Fund (IMF), Asian Development Bank (ADB) and the World Bank. READ MORE
The Economic Survey document also states that government capex is expected to climb further. "Union government capex is up 8.2 per cent in July – November 2024 and is expected to pick up further pace," it states.
Further, the document highlights that on the supply side, real GVA is also estimated to grow by 6.4 per cent in FY25, while growth in the agriculture sector is expected to rebound to an increase of 3.8 per cent in FY25. The industrial sector is estimated to grow by 6.2 per cent in FY25, according to the policy document.
Regarding the capital markets, the Economic Survey highlighted that a surge in retail participation over the past five years, both in terms of investor numbers and trading activity, has led the equity markets to have a steady run since the onset of the pandemic.
Also Read: Economic Survey 2025: Inflation stays high as food prices defy global dip The unique investor base at the National Stock Exchange (NSE) surpassed the 10-crore mark in August 2024, tripling in the last four years, and currently stands at 10.9 crore (as of 26 December 2024). The number of client codes, indicating the number of investor accounts at NSE, has risen from a little under six crore at the end of 2019 to nearly 21 crore as of December 2024, it states.
However, highlighting potential risks for the markets in India, the policy document states that elevated valuations and optimistic market sentiments in the US raise the likelihood of a meaningful correction in 2025. It states: "Should such a correction occur, it could have a cascading effect on India, especially given the increased participation of young, relatively new retail investors. Many of these investors that have entered the market post-pandemic have never witnessed a significant and prolonged market correction. Hence, if one were to occur, its impact on sentiment and spending may be non-trivial".