Sensex, Nifty trade in fine-fettle after optimistic start amid foreign fund inflows

Indian markets bounced back on Thursday from their biggest single day loss in the previous session amid renewed escalation in tensions between Iran and the United States. Sensex and Nifty made an optimistic start and were trading in fine-fettle in early deals on account of bargain hunting at lower levels. Some support also came as foreign investors remained buyers of Indian equities for a sixth consecutive session on July 08 despite the renewed Middle East conflict. They bought Rs 1,963 crore ?worth of shares. Traders drew comfort from the IMF's view that India remains among the fastest-growing major economies, backed by resilient private consumption and robust services activity, despite a marginal downward revision in its FY27 growth forecast. IMF projected India’s economy growth at 6.4% for FY27, slightly lower than its 6.5% growth projection in the April Outlook. Meanwhile, market participants were eyeing the kick start of Q1 earnings season with India's largest IT services company, Tata Consultancy Services (TCS) is all set to announce its June quarter (Q1FY27) results later in the day.

On the global front, Asian markets were trading mixed, following the mixed cues from Wall Street overnight, amid a relief rally for the chip sector after a prolonged bout of selling, but gains were tempered by sharp spikes in oil prices due to renewed tensions in the Persian Gulf, which raised inflation concerns and weighed markets. 

The BSE Sensex is currently trading at 77041.90, up by 538.30 points or 0.70% after trading in a range of 76576.14 and 77095.37. There were 22 stocks advancing against 8 stocks declining on the index.

The top gaining sectoral indices on the BSE were Realty up by 1.95%, Healthcare up by 1.69%, Consumer Durables up by 1.61%, Telecom up by 1.60% and Consumer Discretionary up by 1.32%, while IT down by 0.82% and Metal down by 0.29% were the top losing indices on BSE.

The top gainers on the Sensex were Eternal up by 4.34%, Sun Pharma up by 2.60%, Bharti Airtel up by 2.48%, ICICI Bank up by 1.23% and Asian Paints up by 1.18%. On the flip side, Infosys down by 2.14%, TCS down by 1.24%, HCL Technologies down by 1.04%, Bajaj Finance down by 1.01% and Tech Mahindra down by 0.98% were the top losers.

Meanwhile, the International Monetary Fund (IMF), in its July update to the World Economic Outlook (WEO), has said that the Indian economy is likely to grow at 6.4 per cent in fiscal year 2026-27 (FY27), 10 basis points (bps) lower than its 6.5 per cent growth projection in the April Outlook. It noted that higher energy prices may offset the resilience in the country's economic activity. It further projected India’s economy to grow at 6.7 per cent in FY28, 20 basis points higher than the 6.5 per cent growth projected in the April Outlook.

According to the IMF, India remains among the fastest-growing major economies, with growth projected at 6.4 per cent, supported by strong momentum in private consumption and services activity. Deniz Igan, Division Chief (World Economic Studies) said “Factors underpinning the forecast revisions are basically twofold. On the upside, we have the better-than-expected outturn in the most recent data, and we also have high-frequency indicators through April showing considerable resilience in overall economic activity.”

She added that these positive factors are more than offset in 2026 by higher energy prices in the baseline and the July update, as well as a greater pass-through of higher oil prices to fuel prices in India. She further said “Moving into 2027, the IMF expects a strengthening of the economy as the energy shock dissipates, with medium-term growth estimated at around 6.5 per cent and the output gap closing, leading to some pickup in activity.”

IMF projected global growth at 3.0 per cent in 2026 and 3.4 per cent in 2027, down from the average growth of 3.5 per cent recorded during 2024-25 and broadly unchanged on a cumulative basis compared with the forecasts made in April. The modest slowdown reflects the effects of the war in the Middle East being partly offset by accelerated demand-driven momentum in the global technology cycle, supported by advances in artificial intelligence (AI) and its adoption. The IMF noted that the impact varies significantly across countries, depending on their exposure to the conflict and their position in the technology value chain.

The CNX Nifty is currently trading at 24044.35, up by 162.30 points or 0.68% after trading in a range of 23927.70 and 24067.40. There were 37 stocks advancing against 13 stocks declining on the index.

The top gainers on Nifty were Eternal up by 4.17%, Bharti Airtel up by 2.83%, Sun Pharma up by 2.31%, JIO Financial Services up by 1.58% and Apollo Hospital up by 1.51%. On the flip side, Infosys down by 2.12%, Hindalco Industries down by 1.62%, TCS down by 1.22%, Dr. Reddy's Lab down by 1.10% and Bajaj Finance down by 1.10% were the top losers.

Asian markets were trading mixed; Hang Seng declined 220.46 points or 0.92% to 23,979.00, Taiwan Weighted lost 27.98 points or 0.06% to 45,706.43, Shanghai Composite weakened 18.39 points or 0.47% to 3,952.49 and KOSPI fell 1.21 points or 0.02% to 7,245.58. On the other hand, Nikkei 225 surged 1225.95 points or 1.8% to 68,045.00, Straits Times rose 38.24 points or 0.71% to 5,407.81 and Jakarta Composite was up by 12.42 points or 0.21% to 5,885.79.