Record GDP, Strong Earnings - Why Are Markets Still Struggling?

India posted a strong 8.2% GDP growth, the highest in six quarters, surprising economists and the market. Yet equities remain stagnant, leaving investors puzzled. The expert explains that while GDP appears strong, a part of the surge may be due to inventory stocking effects, which the market seems to have looked through. However, the real story lies in earnings performance: large caps delivered 10% growth, mid-caps 25%, and small caps an impressive 37% on a low base. Despite robust fundamentals, skepticism driven by geopolitical tensions, tariff worries, and cautious retail sentiment is weighing on market momentum. The expert remains optimistic, expecting mid-teens earnings growth in Q3 and stronger numbers in March, supported by easing monetary and fiscal conditions.