Indian equity benchmarks rose on Friday to extend gains for the sixth straight session, defying a broader global risk assets’ sell-off driven by fears of a sharp global economic slowdown from rising borrowing costs worldwide.
The 30-share BSE Sensex index advanced 104.25 points, or 0.18 per cent, to end at 59,307.15, and the broader NSE Nifty-50 index nudged 12.35 points, or 0.07 per cent, higher to close at 17,576.30.
Both the leading stock exchanges, the BSE and the NSE, will conduct a one-hour special muhurat trading session on Monday, marking the beginning of a ‘New Samvat 2079’ — the Hindu calendar year that starts on Diwali.
ICICI Bank, Hindustan Unilever, Kotak Mahindra Bank, Nestle, Titan, and UltraTech Cement were among the 30-share pack’s other notable gains.
However, the laggards were Larsen & Toubro, IndusInd Bank, Bajaj Finance, and Bajaj Finserv.
On the NSE, Axis Bank stock rose about 10 per cent on Friday to hit a record high of Rs 906 per share after reporting solid earnings growth late on Thursday.
Both domestic benchmarks have rallied – including the reversal of losses in the morning sessions – despite the weak investor sentiment globally for risk assets.
The momentum was further boosted by foreign institutional investors (FIIs) turning net buyers in the market on Thursday after many sessions.
That even as global stocks fell and Treasury yields rose, traders wagered that the Federal Reserve would keep raising interest rates until inflation could be controlled. Investors also analysed recent earnings reports to gauge how well-adapted corporations were to various challenges.
An indicator of Asian equities pointed to the second week of falls. The US is reportedly exploring new export rules that would restrict China’s access to advanced computing technologies, which caused shares of several Chinese chip-related companies to decline.
European shares fell, and Wall Street futures gauges pointed to a lower opening.
Twitter’s shares tanked as much as 16 per cent in premarket trading after news that the US administration officials were debating whether the US should evaluate some of Elon Musk’s enterprises for national security reasons, including the offer for the social media business.
As traders factored in a higher peak Fed policy rate, the yield on the 10-year US note increased to its highest level since 2007, boosting the dollar. More intervention may be required to stabilise the Japanese currency, according to concerns that the yen has fallen past the widely watched 150 to a dollar barrier.
“The move for US Treasuries is reminiscent of 2007, and we may see the pressure on the market persist until yields reach levels last seen just before the 2008 crisis, where the 2-year topped out at just over 5 per cent and the 10-year nearly reached 5.30 per cent,” Economists at Rand Merchant Bank said in a note Friday, according to Bloomberg.
“With yields at current levels, it is not surprising to see that the greenback remains supported –pressuring most risk assets — while equity market volatility remains high. “