GDP data, market performance have little correlation: ICICI Securities

Market rarely reacts to the release of economic data such as GDP growth or factory output

The gross economic product (GDP) data and market performance have little correlation, reveals an analysis done by domestic brokerage ICICI Securities.

“GDP has virtually no correlation with near-term stock returns. Correlation between the GDP and the Nifty50 returns for the quarter in which the GDP is reported is just 5 per cent with an R-squared value of 2 per cent. Cross country evidence by researchers also indicates that even over the long-term there is no correlation between GDP growth and stock prices,” the brokerage said in a note.

Therefore, it is often seen that the market rarely reacts to the release of