# 1 Market
1.1 Indian equity markets came under sustained pressure last week, with benchmark indices retreating amid escalating global trade tensions, heavy foreign institutional investor (FII) outflows of over ₹14,652 crore, and subdued Q3 earnings. The BSE Sensex declined 2.4% to close at 81,537.70, while the Nifty 50 fell 2.36% to 25,048, capping a bruising week for equities. Fresh record lows in the rupee and simmering geopolitical risks reinforced the risk-off sentiment, offsetting strong domestic institutional investor (DII) buying of ₹20,746 crore.
1.2 Indian bond markets saw upward pressure on yields last week with the 10-year G-Sec rising to around 6.66-6.68% amid US Treasury yield spikes, higher state debt supply fears, and rupee weakness to 91.94/USD. RBI interventions via secondary market buys (~₹65 bn) and reduced state issuance (₹130 bn vs ₹386 bn expected) provided some cushion, limiting further rises despite PMI-driven growth optimism.
1.3 US equity markets posted modest weekly declines weighed down by renewed tariff threats from President Trump, proposals to cap credit card interest rates that pressured financial stocks, and mixed earnings from major banks. The Dow Jones Industrial Average slipped 0.3% to 49,359, the S&P 500 edged down 0.4% to 6,940, and the Nasdaq Composite fell 0.7% to 23,515.
1.4 US 10-year Treasury yields rose sharply last week climbing from ~4.23% to 4.24-4.26% amid Trump’s tariff threats on Europe, robust economic data curbing Fed cut bets, and volatility peaking near five-month highs before a slight Friday pullback.
# 2 RBI
2.1 As per CRISIL report released last week
- Gold-loan NBFC AUMs to surge ~40% CAGR over FY26–FY27, crossing ₹4 lakh crore by March 2027 (vs 27% CAGR in FY23–FY25)
- Elevated gold prices (+68% in 9M FY26) have boosted collateral values, enabling higher disbursements.
- Shift toward secured credit amid tighter unsecured lending is driving borrower demand.
- Large gold-loan NBFCs are scaling portfolios through existing branch networks, leveraging strong brands.
- Mid-sized players are expanding branches and acting as originating partners for larger NBFCs and banks.
- Streamlined LTV norms for small-ticket gold loans effective April 1, 2026, providing extra lending headroom.
- Execution risks remain – tighter controls needed on gold purity, weight, authenticity checks and frequent branch-level audits to avoid auction-stage surprises.
Gold-loan NBFCs are entering a high-growth phase, but sustaining this momentum will hinge on disciplined risk management as competition and regulatory scrutiny intensify
2.2 Key highlights from RBI Bulletin – State of the Economy released last week
- Domestic demand remains the primary growth driver as external demand weakens.
- Services activity stayed in expansion, while manufacturing momentum softened, with new export orders contracting.
- Urban consumption resilient, supported by services and wage growth.
- Rural demand uneven, impacted by elevated food prices and pressure on real incomes.
- Headline CPI eased sequentially but remains vulnerable to food inflation shocks.
- Core inflation subdued, reflecting weak pricing power and easing input costs.
- Merchandise exports under pressure, mirroring the global manufacturing slowdown.
- Services exports and remittances continue to offset trade weakness, keeping the current account deficit manageable.
- Bank credit growth remains strong (double-digit YoY), led by retail and services.
- Deposit growth trails credit growth, keeping the credit-deposit ratio elevated.
- Capital flows volatile, with intermittent FPI outflows amid global risk aversion.
- The financial assets of the domestic sectors registered a growth of 13.9%in 2023-24, up from 9.9% in 2022-23, while financial liabilities increased by 12.7% higher than that of 10.4% in the previous year
India’s growth remains domestically anchored and resilient, but near-term momentum is tempered by global headwinds and sticky food inflation, keeping policy support cautious and data-dependent
2.3 RBI tightens PSL compliance
- All intermediary lenders (NBFCs, MFIs, housing finance companies) must now provide external auditors’ certificates confirming that the same loan is not double counted as a priority sector asset by multiple banks.
- Scheduled banks also must obtain auditor certificates from NBFCs/NBFC-MFIs/HFCs confirming exclusive PSL benefit on on-lent loans.
- Move follows RBI scrutiny of ICICI Bank and HDFC Bank for over-classification of agricultural loans that were allegedly used for non-farm purposes.
- Bank loans to NBFCs for on-lending to agriculture and MSMEs qualify as PSL, capped at 5% of a bank’s total PSL of the previous year.
Overall, the RBI’s move sharpens PSL discipline by curbing misclassification, preventing double counting, and forcing tighter end-use accountability across banks and intermediary lenders.
# 3 SEBI
3.1 SEBI last Friday has mandated a Closing Auction Session (CAS) for equity cash markets, changing how closing prices are discovered and aligning India with global practices to improve price integrity and reduce volatility/manipulation near market close.
- What CAS is:
- Closing prices will be set via an auction, not continuous trading.
- All buy/sell orders are pooled, and a single equilibrium price that maximises traded volume is discovered.
- What changes from current system:
- Replaces the 30-minute VWAP-based closing price, which is vulnerable to “marking the close” through large last-minute trades.
- CAS will run for 20 minutes at the end of the trading day.
- Key benefits for market participants:
- Greater price stability and fairer discovery at close.
- Reduced scope for manipulation, as prices depend on overall demand–supply balance.
- Random auction end time limits last-second order placement or cancellations.
- Phased rollout & safeguards:
- Initially applies to cash market stocks with derivatives.
- 3% price band to curb sharp price swings.
Overall, CAS marks a structural upgrade to India’s equity markets by delivering fairer, more stable and globally aligned price discovery at the close as CAS auctions are standard in US, UK and European markets.
3.2 SEBI has proposed changes in composition of ‘Significant Indices’ — key changes
- Indices with ₹20,000 crore+ cumulative AUM (based on daily average AUM) to be classified as Significant Indices.
- Enhance transparency, governance and accountability in index administration; follows consultations with AMFI.
- Applies to indices tracked/benchmarked by domestic mutual funds where cumulative AUM exceeds the specified threshold.
- If a scheme tracks more than one index, only the AUM portion linked to each index will be counted.
- AUM to be included proportionately based on constituent index weights.
- Not applicable if all Significant Indices are regulated by RBI, including RBI-notified Significant Benchmarks.
Overall, the proposal marks a clear step toward tightening oversight of widely tracked benchmarks, ensuring that indices with systemic relevance are subject to stronger governance standards—while keeping the framework proportionate through AUM-based thresholds and RBI carve-outs.
# 4 Economy
4.1 Key takeaways from SBI Research report released last week
- India’s to attain Upper-middle income status by 2030; high-income target by 2047 (Viksit Bharat vision). Likely to join China and Indonesia by 2030.
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- Upper-middle income threshold: ~$4,500 per capita GNI (World Bank).
- To reach high-income status in ~23 years, India must grow – Per capita GNI CAGR: ~7.5% (if threshold stays at $13,936) with Nominal GDP growth (USD terms): ~11.5%. this is achievable given
- Per capita GNI CAGR of 8.3% during 2001–2024. Compared to 5.3% annual growth recorded between 1961-2007.
- Nominal USD GDP growth of ~11% (FY04–FY20) and ~10% (FY04–FY25).
- Global Income Classification Trends (World Bank) indicate clear global shift towards higher income brackets supporting India’s trajectory.
- 51 low-income countries transitioned from 51 in 1990 to 26 in 2024,
- 29 upper middle-income countries grew to 54 and
- 39 high income countries grew to 87 in the same period.
- India’s journey towards World’s Third-Largest Economy (behind only US and China) spectacular – $1 tn. In 2007, $ 2tn. in 2014, $ 3 tn. in 2021 and $ 4 tn. in 2025 and projected to reach $5 tn. by FY28.
SBI’s analysis underscores that India’s shift to the world’s third-largest economy by 2028 and upper-middle income status by 2030 is no longer aspirational, but a matter of sustaining reform-led growth momentum.Top of Form
4.2 As per data released by Govt. last week
- Eight core infrastructure industries grew 3.7% YoY in December, the fastest pace in four months, marking the second consecutive expansion after an October contraction.
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- Growth improved from an upwardly revised 2.1% in November; December 2024 growth was 5.1%,
- Core sector output expanded 2.6% in Apr–Dec FY26, slower than 4.5% in the same period last year.
- Sectoral split:
- Expanded: Coal (~3.5%), Fertilizers (4.1%), Steel (6.9%), Cement (13.5%), Electricity (5.3%).
- Contracted: Crude oil (–5.6%), Natural gas (–4.4%), Refinery products (–1%).
- Strong cement and steel growth reflects sustained infrastructure activity, aided by front-loaded government capex on roads and railways and rising private investment announcements.
Overall, December’s faster core-sector growth underscores infrastructure-led resilience, even as energy output constraints and a manufacturing slowdown temper the near-term industrial outlook.
4.3 IMF in its report last week upgraded India’s GDP growth::
- GDP forecast for FY26 raised to 7.3%, citing a stronger-than-expected Q3 outturn and solid Q4 momentum.
- Growth is expected to ease to 6.4% in 2026–27 as cyclical and temporary supports fade
- The IMF estimate is in line with NSO’s first advance estimates and the RBI’s headline projection of 7.3%.
- Outlook underpinned by robust domestic consumption, recent tax cuts, and supportive conditions for economic activity.
- The Asian Development Bank has also upgraded its FY26 forecast to 7.2%, driven by similar demand-side strengths.
Overall, India’s near-term growth outlook remains strong and policy-aligned, even as momentum is expected to normalize over the medium term.
4.3 As per RBI data released last week,
- Rupee invoicing in external trade is gaining momentum, though from a low base.
- Exporters and importers increasingly invoicing in rupees, a positive signal for currency internationalisation and macro stability.
- Rupee-invoiced exports of goods and software rose 4.7% YoY during Apr–Nov 2025 to ₹2.0 lakh crore; for FY25, growth stood at 7% YoY.
- Rupee-invoiced imports grew much faster, up 24.5% YoY in Apr–Nov 2025 to ₹1.97 lakh crore, and 34% YoY for FY25.
- Despite the growth, rupee invoicing remains limited accounting for just 6.1% of total export invoicing and 4.9% of import invoicing across currencies.
Momentum is building, especially on the import side, but meaningful internationalisation of the rupee will require a much broader scale-up.
4.4 As per HSBC Flash India PMI report released on Friday
- Manufacturing PMI is forecast to increase to 56.8 from 55.0, the best operating conditions since October
- Manufacturing momentum strengthened, with the Output Index projected at 59.9 in January vs 57.3 in December
- faster growth in new orders and output, with job creation resuming and business confidence improving.
- Services activity remained robust, with the Business Activity Index expected to rise to 59.3 from 58.0.
- Composite PMI Output Index is seen rising to 59.5 in January from 57.8, staying well above the expansion threshold of 50.
January’s flash PMI signals a broad-based rebound in private sector growth, with manufacturing emerging as the key driver of renewed momentum
# 5 PE VC
5.1 Brief highlights from PwC’s 29th Annual Global CEO Survey
- India ranks 2nd globally as the most preferred destination for cross-border investment in 2026, behind the US and on par with the UK and Germany
- 35% of CEOs favour the US; 13% each prefer India, the UK and Germany.
- India moved up from 5th place last year (alongside France) to the top tier in 2026.
- India’s rise reflects strong economic fundamentals and long-term growth prospects.
- Growing cyber and technology risks highlight the need to balance innovation with resilience.
- 46% of global CEOs plan no investments in the coming year.
- Indian CEOs’ focus of investments is on US, UAE and UK are the top cross-border investment destinations.
- Indian optimism contrasts with heightened global uncertainty weighing on international peers.
India’s sharp rise as a preferred investment destination underscores global faith in its growth story, even as caution and uncertainty temper sentiment elsewhere.
5.2 As per Oxfam report on Global Billionaires 2025 published last week –
- Global billionaires crossed 3,000 for the first time in 2025 – Collective billionaire wealth rose to $18.3 trillion, the highest ever recorded.
- Billionaire wealth jumped 16% YoY in 2025.
- Wealth up 81% (+$8.2 trillion) since 2020.
- Wealth growth since Nov 2024 (16.2%) is 3× the average annual growth rate since 2020.
- US billionaires saw the sharpest gains; rest of the world also posted double-digit increases- Key driver: Soaring AI-related valuations significantly boosted fortunes.
- The 12 richest billionaires together own more wealth than the poorest 50% of humanity (over 4 billion people).
- Musk became the first person to cross $700bn in net worth
- Other top richest persons include Larry Page, Jeff Bezos, Mark Zuckerberg and Buffet
Global billionaire wealth hit unprecedented levels in 2025—turbocharged by AI and asset booms—sharpening the contrast between record prosperity at the top and deepening inequality worldwide