Bulls Roar Back on Dalal Street: Sensex & Nifty Snap Losing Streak on GDP Cheer

The Indian stock market snapped its three-day losing streak with a resounding comeback on Monday, as investors cheered surprisingly strong economic growth data.

The bulls took complete control of Dalal Street on September 1, 2025, pushing the benchmark indices significantly higher. The BSE Sensex closed at 80,364.49, a gain of 554.84 points (0.70%), while the NSE Nifty50 surged 198.20 points (0.81%) to settle at 24,625.05. The rally was broad-based, with auto, IT, and consumer durables stocks leading the charge.

What Fueled the Market Rally?

The primary catalyst for this market optimism was the stellar Gross Domestic Product (GDP) data for the first quarter of the financial year 2025-26. India’s economy expanded by a robust 7.8% in the April-June period, marking its fastest pace in five quarters and comfortably beating most forecasts. This strong performance signaled underlying strength in the Indian economy, boosting investor confidence despite global headwinds.

Adding to the positive sentiment was an encouraging update on the manufacturing sector. The HSBC India Manufacturing PMI (Purchasing Managers’ Index) rose to 59.3 in August from 59.1 in July, indicating sustained expansion and the fastest improvement in operating conditions in over 17 years.

Global cues also played a supportive role. A recent US court ruling that deemed some sweeping tariffs imposed by a previous administration as illegal provided temporary relief to markets, particularly for IT companies that derive a significant portion of their revenue from the US.

Sectoral Spotlight and Top Movers

It was a sea of green across most sectors, but some clearly outshone others. The Nifty Auto index was the top performer, revving up by a massive 2.8%. This was driven by strong monthly sales figures reported by several automakers for August 2025.

Stocks like Bajaj Auto (up 4.01%), Mahindra & Mahindra (up 3.52%), Hero MotoCorp (up 3.18%), and Tata Motors (up 3.09%) were among the top gainers on the Nifty50. Eicher Motors also saw its shares climb over 3% following the release of its impressive monthly sales data.

The Nifty IT index also had a stellar day, gaining 1.59%, as the positive news from the US on the tariff front improved the outlook for the sector.

However, not all sectors participated in the rally. The Nifty Pharma index ended with minor losses, with heavyweights like Sun Pharma being one of the top losers on the Sensex, falling 1.91%. Other laggards for the day included ITC and Hindustan Unilever.

What This Means for Retail Investors

Monday’s rally is a welcome relief after a few sessions of correction. The strong GDP numbers are a significant positive, suggesting that the Indian economy is on a solid footing. For retail investors, this reinforces the long-term India growth story.

The outperformance of the auto sector, backed by solid sales numbers, indicates a potential revival in consumer demand, which is a good sign for the overall economy. However, it’s important to remain cautious. While the domestic story looks strong, global factors like geopolitical tensions and final decisions on US tariffs will continue to influence the market.

What to Watch Next

• Global Cues: Keep an eye on further developments regarding the US tariff situation. The final verdict will be crucial for the IT and metal sectors.
• RBI’s Next Move: With strong GDP growth and persistent inflation, the market will be keenly watching the Reserve Bank of India’s commentary and future policy actions.
• FII/DII Activity: Tracking the fund flow from Foreign Institutional Investors (FIIs) and Domestic Institutional Investors (DIIs) will provide clues about the conviction behind this rally.
• Technical Levels: For the Nifty50, the next psychological level to watch is 25,000. Sustaining above the 24,500-24,600 zone will be key for the continuation of this upward momentum.

This article is for informational purposes only and is not investment advice. Please conduct your own research before investing.