According to V.K. Vijayakumar, Chief Investment Strategist at Geojit Financial Services, the primary driving force behind market dynamics is the remarkable Q3 GDP growth rate, surpassing expectations at 8.4 percent.
Vijayakumar emphasizes the importance of recognizing that the Gross Value Added (GVA) aligns with projections at 6.5 percent. The disparity between GDP and GVA stems from a remarkable 32 percent surge in net indirect taxes.
Key highlights from the GDP figures include an impressive 11.6 percent expansion in manufacturing, a robust 9.5 percent growth in construction, and a notable 10.6 percent increase in capital formation.
“The robust GDP figures bolster the bull market with large caps like RIL, Bharti Airtel, L&T, and ICICI Bank poised to lead the charge, while tepid private consumption may weigh on consumer staples such as HUL,” stated an expert.
Highlighting the market trend ahead, the expert added, “The overarching theme is the expected outperformance of large caps compared to the broader market.”
Devarsh Vakil, Deputy Head of Retail Research at HDFC Securities, commented on the GDP growth, stating that it surpassed analysts’ expectations, with India’s GDP expanding by 8.4 percent annually in the third quarter. This growth outpaced the previous quarter’s 8.1 percent. Additionally, Vakil noted that Q1 and Q2 FY24 figures were revised upwards to 8.2 percent (from 7.8 percent) and 8.1 percent (from 7.6 percent), respectively.
Regarding market activity, Vakil noted that Nifty closed higher on February 29 despite choppy trading, with the last 30 minutes witnessing a rise in values and volumes due to monthly F&O expiry and MSCI rebalancing. Nifty recorded a 1.18 percent increase over February.
As of the latest update, BSE Sensex was trading at 73,260 points, up 763 points, with Tata Steel and JSW Steel both posting gains of 3 percent.