Indian equity benchmarks fell sharply on Friday, snapping their six-day gaining streak, amid intense selling in Metal, Basic Materials and Banking stocks. Investors also turned their attention towards US Federal Reserve Chair Jerome Powell's forthcoming statements at the Jackson Hole Symposium.

Some of the important factors in today’s trade: 

India's GDP likely to be lower at 6.3% in FY26 over RBI's projection of 6.5%: SBI Research Report has said that India's economic growth is expected to be lower at 6.3 per cent in the fiscal year 2025-26 (FY26) compared to the Reserve Bank of India’s (RBI's) projection of 6.5 per cent. 

Farm, rural inflation eases in July: Retail inflation for farm and rural workers eased to 0.77 per cent and 1.01 per cent in July from 1.42 per cent and 1.73 per cent, respectively, in June, according to data released by the Labour Ministry. 

Rupee falls against US Dollar: Indian rupee fell against the greenback as domestic equity markets ended weaker and the US dollar strengthened ahead of the speech of Fed Chairman Jerome Powell.

Inflow of foreign funds: Foreign institutional investors (FIIs) bought a net Rs 1,246.51 crore worth of Indian equities on Thursday, their largest single-day purchase since Aug 8, according to exchange data. 

Global front: European markets were trading in green amid selective buying ahead of Federal Reserve Chair Jerome Powell's speech at Jackson Hole Symposium later in the day. Asian markets settled mostly higher as investors awaited Fed Chair Jerome Powell's upcoming speech at the Jackson Hole symposium later in the day for additional clues on the timing and size of potential interest rate cuts.  

Finally, the BSE Sensex fell 693.86 points or 0.85% to 81,306.85 and the CNX Nifty was down by 213.65 points or 0.85% to 24,870.10.   

The BSE Sensex touched high and low of 81,993.61 and 81,291.77 respectively. There were 6 stocks advancing against 24 stocks declining on the index.  

The broader indices ended in red; the BSE Mid cap index fell 0.23%, while Small cap index was down by 0.35%.

The top gaining sectoral indices on the BSE were Telecom up by 0.68%, Healthcare up by 0.09% and Capital Goods up by 0.08%, while Metal down by 1.27%, Basic Materials down by 1.08%, Bankex down by 1.06%, FMCG down by 1.04% and Energy down by 0.89% were the top losing indices on BSE.

The top gainers on the Sensex were Mahindra & Mahindra up by 0.79%, Maruti Suzuki up by 0.65%, Sun Pharma up by 0.20%, Bharat Electronics up by 0.19% and Bharti Airtel up by 0.14%. On the flip side, Asian Paints down by 2.44%, Ultratech Cement down by 1.94%, ITC down by 1.84%, Tata Steel down by 1.83% and HCL Technologies down by 1.77% were the top losers. 

Meanwhile, SBI Research Report has said that India's economic growth is expected to be lower at 6.3 per cent in the fiscal year 2025-26 (FY26) compared to the Reserve Bank of India’s (RBI's) projection of 6.5 per cent. The report pegged the first quarter Gross Domestic Product (GDP) estimate at around 6.8-7 per cent, mainly due to muted private capex. The report said the Indian economy is expected to grow at 6.5 per cent in the second quarter and at a lower rate of 6.3 per cent in the third quarter. It added that in the fourth quarter of the current financial year, the GDP growth will be lowest at 6.1 per cent.

Talking about headwinds, the report said a major source of concern for sustainable growth is the muted private capex. It said ‘Data based on a survey of 2,170 enterprises (conducted during April 2025), ranging from Agri, Manufacturing, IT, etc., has indicated that the intended capex for FY26 is significantly lower than the FY25 numbers...we believe that numbers may further decline as US tariffs may significantly impact the capex’. It said the impulse response of government capital expenditure to its own structural shock demonstrates strong persistence, and added that the estimated response exhibits an immediate positive jump, followed by short-term oscillations, and subsequently converges to a stable positive level.

It added public capital expenditure is not a transitory or noise-driven component of fiscal policy, but a persistent driver reinforcing its role as a structurally sustainable element in the expenditure composition.  With the imposition of tariffs by the US, it said ‘we may see an effect in revenue and margin pressure in export-oriented tariff-affected sectors, such as Textile, Gems and Jewellery, leathers, Chemicals, Agriculture, Auto Components, etc, in Q2’.

Compared to the SBI report, the Reserve Bank has projected real GDP growth at 6.5 per cent in Q1, Q2 at 6.7 per cent, Q3 at 6.6 per cent, and Q4 at 6.3 per cent. As per the latest Economic Survey, India's economy is likely to grow at 6.3-6.8 per cent in 2025-26 on the back of strong macroeconomic fundamentals, though strategic and prudent policy management will be required to navigate global headwinds. The country witnessed a muted growth at 6.5 per cent in 2024-25 (April 2024 to March 2025), down from 9.2 per cent in the previous year.

The CNX Nifty traded in a range of 25,084.85 and 24,859.15. There were 8 stocks advancing against 42 stocks declining on the index.

The top gainers on Nifty were Mahindra & Mahindra up by 0.74%, Maruti Suzuki up by 0.63%, Bharat Electronics up by 0.25%, Bharti Airtel up by 0.16% and Titan Company up by 0.07%. On the flip side, Grasim Industries down by 2.55%, Asian Paints down by 2.40%, Adani Enterprises down by 2.28%, Ultratech Cement down by 2.06% and Hero MotoCorp down by 2.06% were the top losers.

European markets were trading in green; UK’s FTSE 100 increased 10.95 points or 0.12% to 9,320.15, France’s CAC rose 22.21 points or 0.28% to 7,960.50 and Germany’s DAX gained 34.26 points or 0.14% to 24,327.60. 

Asian markets settled mostly higher on Friday amid investors await Fed Chair Jerome Powell's upcoming speech at the Jackson Hole symposium later in the day for additional cues on the timing and size of potential interest rate cuts. However, stalled Russia-Ukraine peace talks, Fed independence worries and hawkish comments from several Federal Reserve officials have limited further gains in market sentiments. Chinese market gained as private report suggested the rally in onshore Chinese shares will continue. Seoul shares rose as chip and defense shares leading the gains. Meanwhile, Japanese markets ended on a flat note as hotter than expected core inflation data for July raised expectations of interest rate hike.