The domestic equity benchmarks ended with significant losses this week, weighed down by heightened volatility. Indices ended lower for three out of five trading sessions. The decline was driven by escalating global trade tensions including fiscal deficits, rising bond yields and renewed fiscal concerns in major economies. Investor sentiment was further dampened by growing apprehensions over the U.S. fiscal outlook, following Moody’s downgrade of the U.S. credit outlook. Investors largely overlooked several positive domestic economic data and reacted strongly to overseas headwinds.
Going forward, investors are expected to closely track bond yields, global economic indicators, and upcoming Q4 earnings results.
In the week ended on Friday, 23 May 2025, the S&P BSE Sensex declined 609.51 points or 0.74% to settle at 81,721.08. The Nifty 50 index fell 166.65 points or 0.67% to settle at 24,853.15. The BSE Mid-Cap index dropped 0.32% to close at 44,861.42. The BSE Small-Cap index jumped 0.93% to end at 51,521.42.
Weekly Index Movement:
Equity benchmarks ended slightly in the red on Monday, logging a second straight day of losses as investor sentiment remained fragile. The S&P BSE Sensex declined 271.17 points or 0.33% to 82,059.42. The Nifty 50 index fell 74.35 points or 0.30% to 24,945.45. In the past two trading session Sensex and Nifty declined 0.57% and 0.47%.
Benchmark equity indices ended sharply lower on Tuesday, logging a third consecutive session of losses. The S&P BSE Sensex, tumbled 872.98 points or 1.06% to 81,186.44. The Nifty 50 index declined 261.55 points or 1.05% to 24,683.90. In the past three trading session the Sensex and Nifty declined 1.63% and 1.51%
The domestic equity benchmarks broke their three-day losing streak and ended with respectable gains Wednesday. The S&P BSE Sensex gained 410.19 points or 0.51% to 81,596.63. The Nifty 50 index rose 129.55 points or 0.52% to 24,813.45. In the previous three session, the Sensex and Nifty declined 1.63% and 1.51%, respectively.
The domestic equity benchmarks ended sharply lower Thursday, echoing a global selloff triggered by rising bond yields and renewed fiscal concerns in major economies. The S&P BSE Sensex tanked 644.64 points or 0.79% to 80,951.99. The Nifty 50 index tumbled 203.75 points or 0.82% to 24,609.70.
The key equity domestic indices ended with substantial gains on Friday. The S&P BSE Sensex, zoomed 769.09 points or 0.95% to 81,721.08. The Nifty 50 index jumped 243.45 points or 0.99% to 24,853.15.
Economy:
India's infrastructure output, which tracks activity across eight sectors and makes up 40% of the country's industrial production, grew at 0.5% annually in April as against 4.6% in March, data from Ministry of Commerce & Industry showed on Tuesday. The Index of eight Core Industries is the measure of combined and individual performance of production of eight core industries: Coal, Crude Oil, Natural Gas, Refinery Products, Fertilizers, Steel, Cement and Electricity.
India's retail inflation for farm as well as rural workers eased marginally to 3.48% and 3.53%, respectively, in April this year compared to the pace of price hikes for the two categories at 3.73% and 3.86% recorded in March. The All-India Consumer Price Index for Agricultural Labourers (CPI-AL) and Rural Labourers (CPI-RL) increased by 1 point each in April 2025 to stand at 1307 and 1320 points, respectively. The CPI-AL and CPI-RL were 1306 points and 1319 points, respectively, in March.
India's private sector activity witnessed a notable acceleration in May, as indicated by the HSBC Flash India Composite Output Index, which rose to 61.2 from 59.7 in April. The seasonally adjusted index, tracking month-on-month changes in output across both manufacturing and services, signaled a sharp rate of expansion.
The HSBC Flash India Manufacturing PMI remained largely stable, edging up slightly to 58.3 in May from 58.2 in April. The reading continued to reflect a strong improvement in the overall health of the manufacturing sector. In contrast, the HSBC Flash India Services PMI Business Activity Index surged to 61.2 from 58.7, while the HSBC Flash India Manufacturing PMI Output Index dipped marginally to 61.4 from April's 61.9.
Global rating agency Fitch Ratings has raised India’s GDP growth potential by 0.2 percentage points to 6.4% over the next five years. The move comes following a sharper rise in the country’s labour force participation rate in recent years. Fitch highlighted that the revised estimate for India shows a stronger contribution from labour inputs, mainly total employment.
At the same time, the global rating agency has scaled down China’s growth projection by 0.3 percentage points to 4.3% from 4.6% earlier. The changes are part of Fitch’s revised assessment of potential GDP growth for 10 emerging market economies over the next five years.
India continues to remain the world’s fastest growing major economy and the only country expected to clock over 6% growth in the next two years, according to an IMF report released last month. The IMF has trimmed the growth forecast for over 120 countries.
Stocks in Spotlight:
Vodafone Idea nosedived 8.14%. The Supreme Court reportedly dismissed its writ petition seeking urgent relief on Adjusted Gross Revenue (AGR) dues. The ripple effect hit Indus Towers too, with shares sliding up to 2.8%. Following the development, stock exchanges have sought clarification from Vodafone Idea. A response is still awaited.
Protean eGov Technologies declined 31.65%. The company announced that it has not been shortlisted for the next round of bidding in the Income Tax Department’s PAN 2.0 project. The Income Tax Department has invited bids for the selection of a Managed Service Provider (MSP) for the design, development, implementation, operations, and maintenance of its upgraded PAN infrastructure.
Hindalco Industries fell 1%. The company's consolidated net profit jumped 66.45% to Rs 5,283 crore on 15.89% increase in revenue from operation to Rs 64,890 crore in Q4 FY25 compared with Q4 FY24.
Bajaj Auto rose 2.86%. The auto major has announced a strategic step to gain majority control in KTM AG, the Austrian motorcycle manufacturer, through its wholly owned subsidiary, Bajaj Auto International Holdings BV (BAIHBV). To revive the struggling Austrian brand, Bajaj has arranged a comprehensive 800 million euros funding package. The move aims to support KTM's ongoing restructuring and ensure its operational continuity amid financial distress.
Oil and Natural Gas Corporation (ONGC) dropped 1.64%. The company’s standalone net profit fell 34.66% to Rs 6,448.28 crore in Q4 FY25 as against Rs 9,869.37 crore posted in Q4 FY24. Revenue from operations declined marginally to Rs 34,982.23 crore in Q4 FY25, compared to Rs 34,636.69 crore reported in Q4 FY24.
IndusInd Bank added 1.41%. The bank reported a standalone net loss of Rs 2,235.99 crore in Q4 FY25 as against a net profit of Rs 2,346.84 crore posted in Q4 FY24. Total income declined 22.83% year on year to Rs 11,342.65 crore in the quarter ended 31 March 2025.
ITC rose 0.16%. The company’s standalone net profit spiked 289.65% to Rs 19,561.57 crore in Q4 FY25 as against Rs 5,020.20 crore posted in Q4 FY24. Revenue from operations (excluding excise duty) was at Rs 17,248.21 crore in the March quarter FY25, up 9.26% year on year.
Grasim Industries tumbled 5.14%. The company’s consolidated net profit rose 9.20% to Rs 1,495.90 crore in Q4 FY25 as against Rs 1,369.82 crore posted in Q4 FY24. Revenue from operations increased 17.33% YoY to Rs 44,267.26 crore in the fourth quarter of FY25, driven by superior performance in cement, chemicals and financial services businesses.
Sun Pharmaceutical Industries declined 2.98%. The company’s consolidated net profit declined 19% to Rs 2,149.88 crore, despite of 8.5% increase in revenue from operations to Rs 12,815.58 crore in Q4 FY25 over Q4 FY24.
Global Markets:
In China, Industrial production increased by 6.1% year-on-year in April, surpassing expectations but slowing from the previous month’s 7.7% growth. Retail sales rose by 5.1% y-o-y, below the 5.9% growth seen in March. Fixed asset investment grew by 4.0% y-o-y, missing expectations due to continued business uncertainty amid trade tensions.
The People’s Bank of China reduced its key lending rates by 10 basis points in an effort to support economic growth amid ongoing trade tensions. The 1-year loan prime rate was lowered from 3.1% to 3.0%, while the 5-year LPR, commonly used for mortgage pricing, was cut from 3.6% to 3.5%.
Bank of Indonesia cut its interest rate by 25 bps to 5.5%. The central bank had cut interest rates in September 2024 and again in January 2025 but has maintained rates at 5.75% since then.
In Japan, trade data for April showed a surprise deficit, as exports were impacted by stronger yen levels and increased U.S. trade tariffs. The country posted a trade deficit of 115.8 billion yen ($800 million), compared to a 559.4 billion yen surplus in March. Exports rose 2% year-on-year, a slowdown from 4% in the previous month. Imports declined 2.2% year-on-year, compared to expectations for a 4.5% drop, and contrasted with a 1.8% increase in the prior month.
In Japan, the manufacturing sector contracted for the 11th consecutive month in May, with the au Jibun Bank flash manufacturing PMI inching up to 49.0 from April’s 48.7, still below the 50 threshold that signals growth.
Australia’s central bank cut its policy rate to 3.85%, its lowest level since May 2023, as inflation concerns in the country continue to recede, giving room for the bank to ease monetary policy.
U.K.'s annual inflation data for April came in at 3.5%. The latest data release comes against a recent trend of cooling inflation, with the rate of price rises slowing to 2.8% in February and 2.6% in March. Core inflation, which excludes more volatile energy, food, alcohol and tobacco prices, rose by 3.8% in the year to April, up from 3.4% in the twelve months to March.