MUMBAI: Benchmark Sensex surged 741 points while Nifty closed above 23,500 on Friday, driven by heavy buying in Larsen & Toubro following its Q3 results and optimism over a pro-growth Budget as indicated in the Economic Survey.
Extending its gains for the fourth straight session, the 30-share BSE Sensex rose 740.76 points or 0.97 per cent to 77,500.57. It hit an intraday high of 77,605.96, up 846.15 points or 1.10 per cent.
The NSE Nifty climbed 258.90 points or 1.11 per cent to 23,508.40, touching a high of 23,546.80 during the day.
The Economic Survey 2024-25, tabled in Parliament on Friday, projected India’s GDP growth at 6.3-6.8 per cent for FY26, supported by strong economic fundamentals, calibrated fiscal consolidation, and stable private consumption.
“The fundamentals of the domestic economy remain robust, with a strong external account, calibrated fiscal consolidation, and stable private consumption. On balance, we expect growth in FY26 to be between 6.3 and 6.8 per cent,” the survey stated.
L&T, Nestle lead market gains
Among Sensex stocks, Larsen & Toubro soared 4.31 per cent after the engineering and infrastructure major posted a 14 per cent rise in consolidated profit after tax to Rs3,359 crore for Q3, driven by higher revenue from operations.
Nestle gained 4.25 per cent after the FMCG giant reported a 4.94 per cent increase in net profit to Rs688.01 crore for the December quarter.
Other major gainers included IndusInd Bank, Titan, Tata Motors, Tata Steel, ITC, and Maruti. Meanwhile, ITC Hotels, Bharti Airtel, Bajaj Finserv, Bajaj Finance, and ICICI Bank were among the laggards.
For January, the BSE benchmark declined 638.44 points or 0.81 per cent, while the Nifty lost 136.4 points or 0.57 per cent.
Survey flags risks of market correction
The Economic Survey sounded a note of caution on high stock market valuations, warning that a correction in US markets could have a cascading impact on Indian equities, especially given the surge in retail participation post-Covid.
Retail investor participation has jumped from 4.9 crore in FY20 to 13.2 crore as of December 31, 2024.
“Elevated valuations and optimistic market sentiment in the US raise the likelihood of a meaningful correction in 2025. Should this happen, it could have a cascading effect on India, particularly given the influx of young, relatively new retail investors,” the survey noted.
It highlighted that many new investors, who entered the market post-pandemic, have never experienced a prolonged correction, which could significantly impact sentiment and spending.
Historical data suggests the Indian equity market has been highly sensitive to US trends. Between 2000 and 2024, in 22 instances when the S&P 500 corrected by more than 10 per cent, the Nifty 50 posted negative returns in all but one case, averaging a 10.7 per cent decline.
Conversely, during 51 instances when the Nifty 50 corrected by over 10 per cent, the S&P 500 posted positive returns in 13 cases, with an average return of -5.5 per cent.
Global markets
In Asia, Tokyo ended higher, while Seoul closed lower. Markets in Shanghai and Hong Kong were shut for holidays. European markets were trading higher, and US markets closed in positive territory on Thursday.
Foreign Institutional Investors (FIIs) sold equities worth Rs4,582.95 crore on Thursday, according to exchange data.
Global oil benchmark Brent crude slipped 0.26 per cent to $76.64 per barrel.
On Thursday, the BSE Sensex had gained 226.85 points or 0.30 per cent to close at 76,759.81, while the Nifty rose 86.40 points or 0.37 per cent to 23,249.50.
Stock markets will remain open for trading on Saturday for the Union Budget presentation.
