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Time of India
14-06-2025
- Business
- Time of India
India's soft industrial momentum, widening trade gap & business caution, key risks in H2 2025: Report
A recent LLama Research report indicates that while India's economy exhibits strong growth and moderating inflation, certain vulnerabilities warrant attention as H2 2025 approaches. Softening industrial momentum, a growing trade deficit, and initial signs of business caution require careful monitoring. Tired of too many ads? Remove Ads Tired of too many ads? Remove Ads New Delhi: India 's soft industrial momentum, a widening trade gap , and early signs of business caution warrant close tracking as H2 2025 unfolds, according to a report by LLama the broader economic outlook remains positive, the report added that there are signs that some areas of the economy may need close attention going report said "India continues to run a "Goldilocks" macro script -- strong growth and moderating inflation -- with solid buffers in place. However, soft industrial momentum, a widening trade gap, and early signs of business caution warrant close tracking as H2 2025 unfolds".India is currently in a high-growth, low-inflation sweet spot. The growth is being led largely by the services sector, which continues to show strong momentum. However, industrial output is showing signs of weakness and needs to be watched carefully in the coming report noted that economic growth is accelerating. India's GDP rose to 7.4 per cent in the first quarter of 2025, up from 6.2 per cent in the last quarter of 2024. Gross Value Added (GVA) also improved to 6.8 per cent, reflecting resilience in domestic economic activity indicators remain strong. The Manufacturing Purchasing Managers' Index (PMI) stood around 58, while the Services PMI was in the 59-61 range, pointing to steady demand in both signs of industrial slowdown are emerging. The Index of Industrial Production (IIP) has slowed to 2.7 per cent, due to weakness in mining, manufacturing, and electricity the inflation front, there is positive news. Consumer Price Index (CPI) inflation fell sharply to 2.8 per cent in May 2025, from 5.2 per cent in December 2024, mainly due to a decline in food prices. Core inflation remains stable around 4 per cent, and the Wholesale Price Index (WPI) at 0.85 per cent suggests more price stability the positive growth and inflation trends, the report cautioned that several risks need monitoring. These include a widening trade deficit that could put pressure on the Indian rupee if capital inflows slow, persistent core inflation, global commodity price swings, and weak growth in core addition, business sentiment is showing early signs of caution, and flat labour force participation remains a long-term structural report concluded that while India's macroeconomic situation appears robust, close tracking of key indicators will be crucial as the second half of 2025 progresses.
Economic Times
14-06-2025
- Business
- Economic Times
India's soft industrial momentum, widening trade gap & business caution, key risks in H2 2025: Report
Live Events (You can now subscribe to our (You can now subscribe to our Economic Times WhatsApp channel New Delhi: India 's soft industrial momentum, a widening trade gap , and early signs of business caution warrant close tracking as H2 2025 unfolds, according to a report by LLama the broader economic outlook remains positive, the report added that there are signs that some areas of the economy may need close attention going report said "India continues to run a "Goldilocks" macro script -- strong growth and moderating inflation -- with solid buffers in place. However, soft industrial momentum, a widening trade gap, and early signs of business caution warrant close tracking as H2 2025 unfolds".India is currently in a high-growth, low-inflation sweet spot. The growth is being led largely by the services sector, which continues to show strong momentum. However, industrial output is showing signs of weakness and needs to be watched carefully in the coming report noted that economic growth is accelerating. India's GDP rose to 7.4 per cent in the first quarter of 2025, up from 6.2 per cent in the last quarter of 2024. Gross Value Added (GVA) also improved to 6.8 per cent, reflecting resilience in domestic economic activity indicators remain strong. The Manufacturing Purchasing Managers' Index (PMI) stood around 58, while the Services PMI was in the 59-61 range, pointing to steady demand in both signs of industrial slowdown are emerging. The Index of Industrial Production (IIP) has slowed to 2.7 per cent, due to weakness in mining, manufacturing, and electricity the inflation front, there is positive news. Consumer Price Index (CPI) inflation fell sharply to 2.8 per cent in May 2025, from 5.2 per cent in December 2024, mainly due to a decline in food prices. Core inflation remains stable around 4 per cent, and the Wholesale Price Index (WPI) at 0.85 per cent suggests more price stability the positive growth and inflation trends, the report cautioned that several risks need monitoring. These include a widening trade deficit that could put pressure on the Indian rupee if capital inflows slow, persistent core inflation, global commodity price swings, and weak growth in core addition, business sentiment is showing early signs of caution, and flat labour force participation remains a long-term structural report concluded that while India's macroeconomic situation appears robust, close tracking of key indicators will be crucial as the second half of 2025 progresses.
Mint
13-06-2025
- Business
- Mint
Indian stock market gives 18% returns in 5 years, beats China, other global market peers; small-cap stocks outperform
Indian stock market has emerged as the top-performing globally, significantly outpacing both developed and emerging market peers over short and long-term horizons, according to the June 2025 Monthly Market Outlook by Bandhan Mutual Fund. For the three-month period ending May 2025, Indian equities delivered an impressive 16% return, sharply outperforming the 5% gain in emerging markets and the modest 2% rise in world and developed markets. The data highlights India's resilience and continued investor interest despite global uncertainties. Over a five-year horizon, Indian stock market has been the best-performing market in US dollar terms, delivering 18% annualised returns. This surpasses the 12% returns of world and developed markets and is over four times higher than returns from emerging markets, the fund house noted. In contrast, China saw a 2% decline in May 2025, standing out negatively among major global markets, most of which ended the month in green. Index/Returns in USD 3 Months 5-Year India 16% 18% World 2% 12% Developed Markets 2% 12% Emerging Markets 5% 4% From a market capitalisation lens, small-cap stocks have been the top performers over the last three months, five years, and since the pandemic lows of March 2020. Mid-caps came in second, followed by large-caps, highlighting the strong risk appetite and domestic participation in broader segments of the market. Time Period/ Returns 3 Months 5 Years Large-caps 13% 22% Mid-caps 17% 32% Small-caps 21% 36% Sector-wise, industrials, capital goods, and telecom led the rally in May with double-digit returns, driven by strong earnings and policy tailwinds. In contrast, FMCG, healthcare and IT, traditionally seen as defensive sectors, posted the lowest positive returns, while utilities were flat and metals saw marginal declines. India's Services PMI rose in May, pointing to a recovery in the services sector. However, the Manufacturing PMI slipped, reflecting some slowdown in industrial output. The fund house noted that a weakening US dollar, falling domestic interest rates, and earnings largely in line with expectations contributed to the robust market performance. 'The domestic economy seems to be turning around and is much better placed than the global economy,' said Manish Gunwani, Head Equities, Bandhan AMC. He also cautioned about near-term volatility due to global trade developments. 'As the US continues to sign trade deals, the front-loading of global trade has supported activity, but the introduction of tariffs could disrupt flows.' On the macroeconomic front, India's FY25 fiscal deficit met the revised target of 4.8% of GDP, with FY26 budgeted at 4.4%, indicating continued fiscal discipline. Inflation momentum appears benign, with food CPI showing negative growth for the sixth consecutive month, while core inflation edged higher. The India Meteorological Department's forecast of an above-normal monsoon is expected to support food supply and keep inflationary pressures in check. Meanwhile, the RBI's surprise 50 basis point rate cut and a 100 basis point CRR reduction signal a strong pro-growth bias, aimed at ensuring swift monetary transmission. 'This proactive stance is intended to support economic recovery and fuel credit growth,' said Suyash Choudhary, Head – Fixed Income, Bandhan AMC. As of May 16, 2025, bank credit grew 9.8% YoY, while deposits increased 10%, underscoring improving liquidity and confidence in the financial system. While India appears well-placed relative to global peers, Gunwani expects market volatility to persist in the coming quarters, driven by external uncertainties such as global trade realignments and geopolitical developments. However, strong domestic macro fundamentals, a benign inflation outlook, and supportive fiscal and monetary policy provide a solid cushion for Indian equities. Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint. We advise investors to check with certified experts before making any investment decisio
Yahoo
05-06-2025
- Business
- Yahoo
US economy shows signs of 'paralysis' as new data reveals hiring slowdown, activity contraction in May
For months, US economic data has shown resilience, with layoffs remaining low and business activity staying steady despite fears over policy uncertainty. But the tide may be shifting. Multiple data points this week have shown signs of slowing as a wide swath of tariffs has been in effect. On Thursday, weekly filings for unemployment benefits hit their highest level since October 2024, adding to a slew of data showing a cooling economy leading into the Friday morning release of the May jobs report. Earlier in the week, the Institute for Supply Management's Services PMI registered a reading of 49.9 in May, below the 51.6 seen in April. Readings above 50 for this index indicate an expansion in activity, while readings below 50 indicate contraction. May's data marked just the fourth time the services sector has fallen into contraction in the past five years. Jefferies US economist Tom Simons wrote in a note to clients that the ISM services data likely reflects "more signs of a pause in activity rather than a steep contraction." "A broad pause is not a good thing, and the uncertainty that precipitated this pause has not shown any signs of lifting," Simons wrote. And it's not just one sector pressing pause as tariffs take hold. On Monday, the ISM's manufacturing PMI also showed contraction in May as imports hit their lowest level since 2009, with a wide swath of President Trump's tariffs taking hold. Economists have reasoned that it's not just the tariffs themselves causing businesses to slow activity. It's the uncertainty of where policy — and eventually the broader economy — is headed in 2025. That includes the labor market: In May, the private sector added 37,000 jobs, the lowest monthly total in more than two years, per ADP data released Wednesday. "When it comes to hiring, there's a hesitancy because of a wide level of uncertainty," ADP chief economist Nela Richardson told Yahoo Finance during a call with reporters. "We're in a situation now where businesses are facing a level of paralysis," RBC Capital Markets economist Carrie Freestone told Yahoo Finance on Wednesday. "Nobody is wanting to ramp up hiring when they don't know what's going to happen down the line." The slowdown in hiring has likely led to an increasing number of workers staying unemployed for longer. Data from the Department of Labor released Thursday morning showed 1.904 million workers filed for continuing unemployment benefits in the week ending May 24. The data is hovering near its highest level since November 2021. ADP's Richardson said the challenge facing corporates is akin to driving through fog. Usually, the driver keeps moving forward but drives slower and more carefully. Whether the fog gets worse or clears in time for the labor market rebound remains key to the economic story as the summer approaches and investors receive more data showing how tariffs are impacting the outlook. "I do think that once the uncertainty clears a bit, you'll see more activity in the labor market," Richardson said. But other economists have pointed out that the data shows a clear sign that the labor market is on thin ice. "We're getting close to some soft employment numbers," Renaissance Macro head of economics Neil Dutta wrote in a note following Thursday's unemployment benefits release. "The broader story here is that with the hiring rate still quite low, it would not take much in the way of layoffs to generate some weak payroll prints." Josh Schafer is a reporter for Yahoo Finance. Follow him on X @_joshschafer. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
05-06-2025
- Business
- Yahoo
US economy shows signs of 'paralysis' as new data reveals hiring slowdown, activity contraction in May
For months US economic data has shown resilience, with layoffs remaining low and business activity staying steady despite fears over policy uncertainty. But the tide may be shifting. Multiple data points this week have shown signs of slowing as a wide swath of tariffs have been in effect. On Thursday, weekly filings for unemployment benefits hit their highest level since October 2024, adding to a slew of data that's showed cooling in the economy leading into the release of the May jobs report on Friday morning. Earlier in the week, the Institute for Supply Management's Services PMI registered a reading of 49.9 in May, below the 51.6 seen in April. Readings above 50 for this index indicate an expansion in activity, while readings below 50 indicate contraction. May's data marked just the fourth time the services sector has fallen into contraction in the past five years. Jefferies US economist Tom Simons wrote in a note to clients the ISM services data likely reflect "more signs of a pause in activity rather than a steep contraction." "A broad pause is not a good thing, and the uncertainty that precipitated this pause has not shown any signs of lifting," Simons wrote. And it's not just one sector pressing pause as tariffs take hold either. On Monday the ISM's manufacturing PMI also showed contraction in May as imports hit their lowest level since 2009, with a wide swath of President Trump's tariffs taking hold. Economists have reasoned that it's not just the tariffs themselves causing businesses to slow activity. It's the uncertainty of where policy —and eventually the broader economy — is headed in 2025. That includes the labor market: In May, the private sector added 37,000 jobs, the lowest monthly total in more than two years, per ADP data released Wednesday. "When it comes to hiring, there's a hesitancy because of a wide level of uncertainty," ADP chief economist Nela Richardson told Yahoo Finance during a call with reporters. "We're in a situation now where businesses are facing a level of paralysis," RBC Capital Markets economist Carrie Freestone told Yahoo Finance on Wednesday. "Nobody is wanting to ramp up hiring when they don't know what's going to happen down the line." The slowdown in hiring has likely led to an increasing number of workers staying unemployed for longer. Data from the Department of Labor released Thursday morning showed 1.904 million workers filed for continuing unemployment benefits in the week ending May 24. The data is hovering near its highest level since November 2021. ADP's Richardson said the challenge facing corporates is akin to driving through fog. Usually the driver keeps moving forward but drives slower and more carefully. Whether the fog gets worse, or clears in time for the labor market rebound remains key to the economic story as the summer approaches and investors receive more data showing how tariffs are impacting the outlook. "I do think that once the uncertainty clears a bit, you'll see more activity in the labor market," Richardson said. But other economists have pointed out that the data shows a clear sign that the labor market is on thin ice. "We're getting close to some soft employment numbers," Renaissance Macro head of economics Neil Dutta wrote in a note following Thursday's unemployment benefits release. "The broader story here is that with the hiring rate still quite low, it would not take much in the way of layoffs to generate some weak payroll prints." Josh Schafer is a reporter for Yahoo Finance. Follow him on X @_joshschafer.
