India’s Nifty posts longest monthly losing run in 23 years; all eyes on budget

India’s equity benchmarks rose on Friday on investor optimism a day ahead of the federal budget, but the Nifty 50 ended January with its longest monthly losing streak in over 23 years, hit by hefty foreign sales and concerns over corporate earnings in a slowing economy.

The Nifty 50 closed 1.11% higher at 23,508.40, while the BSE Sensex rose 0.97% to settle at 77,500.57.

The Nifty has fallen for four months in a row, down 9% over this period. It had risen to a record high in late September.

India’s budget for fiscal year 2025-26, due around 11 a.m. IST on Saturday, is expected to include steps to boost growth while adhering to fiscal discipline, analysts said.

A government report on Friday showed that India’s economy is projected to grow 6.3%-6.8% in 2025-2026, suggesting economic conditions will remain sluggish with growth set to sag to a four-year low of 6.4% in the current fiscal year.

“Investors are looking for a growth-oriented budget free from unexpected policy shocks,” said Krishna Appala, senior research analyst at Capitalmind Research.

IT leads Indian shares higher; Fed policy eyed

India’s equity markets will be open for normal trading on Saturday, while the debt and forex markets will be closed.

On the day, shares of infrastructure sector bellwether Larsen & Toubro rose over 4% after its orders reached an all-time high, driven by strong performance in its international business.

Consumer company Nestle India climbed 4.3% despite missing quarterly earnings estimates as analysts said the worst is over for the sector.

State-owned companies rose 2.6% on expectations of increased budgetary allocations.

Public sector lender Punjab National Bank jumped about 5% after posting a two-fold surge in quarterly net profit.

For the month, twelve of the 13 major sectors declined, with realty leading losses, down 12.5%.

The broader, more domestically-focussed smallcaps lost about 10%, posting their steepest monthly decline since May 2022.

Midcaps fell 6%, their worst showing since October 2024.

Analysts attributed the fall in smallcaps and midcaps to elevated valuations.