From Early Monsoon To India's Q4 GDP — The Week That Was

This past week saw a convergence of significant developments across India’s economic, regulatory, and corporate landscapes. From an early monsoon arrival to GDP data, corporate earnings, and regulatory actions, these events hold implications for markets and the broader economy.

Here's a brief recap of the top headlines that shaped the week:

The Southwest Monsoon arrived unusually early in Mumbai and other parts of Maharashtra on May 26, significantly ahead of the typical June 11 schedule. The India Meteorological Department confirmed this rare occurrence, with heavy rainfall beginning late on May 25 and continuing throughout the week.

This early onset could have a dual impact: it may benefit the agricultural cycle if it sustains, but also raises concerns around preparedness in urban areas prone to flooding. Mumbai, in particular, witnessed intense showers that signalled the active onset of the monsoon season.

India's GDP growth rate rose to a four-quarter high of 7.4% in the January-March period, according to the latest estimates released by the government's statistical office on Friday. This was compared to a revised estimate of 6.4% for the October-December quarter.

For the full year, GDP is estimated to have grown by 6.5%, which is the lowest in four years.

Notably, the GDP was estimated to grow by 6.8% in the fourth quarter, according to economists polled by Bloomberg.

The Reserve Bank of India’s annual report, released on Thursday, showed an 8.2% rise in its balance sheet, reaching Rs 76.25 lakh crore as of March 31. The growth was fuelled by increased gold holdings, domestic and foreign investments, with foreign assets making up over 74% of total assets.

On the liabilities side, the rise was led by higher currency issuance and revaluation accounts. The RBI also transferred Rs 44,861 crore to its contingency fund while skipping any provision for the asset development fund this year.

India's Index of Industrial Production slowed to 2.7% in April, down from 3.9% in March, as per the official data released on Wednesday. The deceleration, despite beating Bloomberg’s 0.9% forecast, marks the slowest pace of expansion in eight months.

The dip reflects global uncertainties, including recent trade policy shifts such as the now-revoked US tariffs. While still in positive territory, the data signals a potential soft patch for India’s manufacturing recovery.

US President Donald Trump urged Federal Reserve Chair Jerome Powell to lower interest rates, in their first meeting ever since the onset of his presidency. Trump argued that current Fed policy was disadvantaging the US economically against competitors like China.

While no commitment was made by Powell, the Fed emphasised that monetary policy decisions would depend on economic data. The meeting, which included several top officials, also reviewed growth, inflation, and employment indicators without hinting at a change in policy outlook.

SEBI’s interim order revealed that IndusInd Bank’s top management was aware of issues in the derivatives accounting book well before they were made public. The bank reportedly failed to disclose critical information while insiders allegedly offloaded shares in late 2023.

The market watchdog said that the board had appointed KPMG to assess these internal findings but never disclosed the appointment to stock exchanges. The situation raises serious governance concerns, especially regarding transparency and insider trading practices.

SEBI relaxed its earlier proposed limits on Index Options trading. The new framework allows a much higher threshold—Rs 1,500 crore net and Rs 10,000 crore gross (per side)—a significant revision from the original Rs 500 crore cap.

The regulator also introduced a new risk measure, the "Future Equivalent Open Interest" metric, for a more accurate view of market exposure. Additionally, the Market Wide Position Limit for single stocks has been recalibrated to better reflect actual trading conditions.

Several IPOs garnered strong investor interest. Prostarm Info Systems led the way with a 97.2x subscription rate, while Scoda Tubes saw 9.73x subscription. Aegis Vopak and Schloss Bangalore also drew decent demand, closing with 2.09x and 4.5x subscriptions, respectively.

Despite a slow start, Schloss Bangalore's IPO picked up momentum thanks to institutional investors, though retail participation remained muted. The overall trend suggests continued appetite for select new listings in a still-cautious equity market.

This week’s earnings calendar featured several notable names. Companies like Vodafone Idea, Nykaa, TCI Express, IRCTC, and Bajaj Auto disclosed their quarterly performance, offering insights into diverse sectors.

Others like Ola Electric, Aurobindo Pharma, NBCC, Mazagon Dock Shipbuilders, and Suzlon Energy also reported their earnings, with investor attention focussed on guidance, margins, and sector-specific developments.