India’s strong economic growth failed to give its stock market the lift investors might have expected. GDP expanded 7.8% in the first quarter of FY27, comfortably beating the 7.1% forecast, but investors responded cautiously to the stronger-than-expected reading. Equities consequently finished slightly lower for a second straight session.
Strong GDP fails to lift stocks
The BSE Sensex slipped 0.02% to 76,944.28 on Tuesday, while the Nifty 50 fell 0.10% to 24,055.80 after swinging between 23,952 and 24,143 during the session. Broader shares struggled more, with the Nifty Midcap 100 dropping 1.39% and the Smallcap 100 losing 0.23%.
Market breadth reflected the subdued mood, with the advance-decline ratio standing at 0.69. Despite foreign institutional investors pouring more than $3.2 billion into Indian markets during August, large-cap stocks remained largely range-bound.
Recent foreign inflows also did not necessarily translate into strong buying on the secondary market. A significant portion reportedly came through QIPs, IPOs and preferential allotments.
Sector performance was mixed, as IT and FMCG gained about 1% and 0.9%, respectively. Auto, Pharma, Realty, PSU Banks and Consumer Durables each declined more than 1%.
Rupee and stocks stand out
The country’s currency offered a brighter signal, strengthening 21 paise to 84.95 against the US dollar. Tuesday’s move marked the rupee’s third consecutive gain and pushed it to its strongest level in two months, helped by RBI dollar supplies and the better-than-expected GDP reading.
Individual stocks produced much bigger moves. TBZ soared 20% to an all-time high after GRT Jewellers agreed to buy a 74.12% stake for up to ₹1,034 crore, while ITC gained 4.3% following ITC Infotech’s investment in Happiest Minds.
Traders are now watching whether equities can regain momentum after two consecutive sessions of losses. The 24,000 level remains key support for the Nifty, while 24,200–24,250 could provide near-term resistance.
