Indian Stock Markets Rally as Nifty Nears 24,500; Sensex Gains 700 Pts

Indian stock markets extended their rally on Tuesday, showing resilience despite concerns over last week’s weak GDP numbers. The NSE Nifty 50 rose 0.85%, reaching an intraday high of 24,481, while the BSE Sensex jumped 700 points to close at 80,949. Together, the two indices have added more than 1,100 points in just two sessions, translating to a 1.4% overall gain.

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Markets Brush Off GDP Concerns

The rally comes after India’s GDP growth for the second quarter of FY25 was reported at a seven-quarter low of 5.4% last Friday. Analysts believe this disappointing data was already factored into the market during previous corrections and subdued corporate earnings. Now, attention is shifting to the Reserve Bank of India (RBI), which is expected to announce its monetary policy later this week.

Banking, Metals, and Oil & Gas Drive Gains

On Tuesday, sectors like banking, metals, and oil & gas took the lead, in contrast to Monday’s focus on defensive plays such as pharma and consumer durables. The Bank Nifty index climbed 1%, with Nifty Financial Services, Nifty Metal, and Nifty Oil & Gas also posting solid gains.

“Banking is outperforming and looks set to remain strong,” said Gautam Shah, founder of Goldilocks Premium Research. “We see the Nifty Bank targeting 55,000,” he told CNBC TV18.

GDP Data Already “Priced In”

Experts argue that the weak GDP figures were already absorbed by the market during the corrections seen in October and November. Gautam Shah emphasized that the market’s ability to move past the disappointing data indicates strong fundamentals and broad investor participation.

Kunal Rambhia, Founder and Fund Manager at The Streets, shared a similar view. He noted that October-November corrections reflected earlier concerns over the economy, but now investors are looking ahead to the RBI’s policy announcement, which could play a key role in shaping market sentiment.

Key Levels to Watch

The Nifty 50 is approaching a critical level at 24,500. Analysts suggest that if the index holds above this level, it could confirm an uptrend and drive further gains. At the same time, the RBI Governor’s upcoming statements are expected to provide crucial insight into interest rate policies and their impact on the markets.

Private Consumption Provides Some Relief

While the overall GDP growth has slowed, private consumption grew by 6%, which is seen as a positive sign. According to Vikas Gupta, CEO of OmniScience Capital, this growth in consumer spending offers hope and reduces concerns about weak demand.

What’s Next for Investors?

All eyes are now on the RBI’s monetary policy announcement, which could offer clarity on interest rates and the economic outlook. If the Nifty 50 breaks decisively above 24,500, it could pave the way for sustained momentum. Banking and financial stocks are likely to remain key drivers in the coming weeks, setting the tone for further gains.