Indian Markets Close Higher as Fed Rate Hike Concerns Ease; Small Caps Hit Record Highs
Mumbai — Indian equity markets ended higher Friday as concerns over an imminent U.S. Federal Reserve rate hike eased, although profit-taking at higher levels and ongoing geopolitical tensions limited gains.
The Sensex rose 362.57 points, or 0.48%, to close at 76,515.43, while the Nifty gained 24.25 points, or 0.10%, to settle at 23,897.70.
During the session, the 30-stock Sensex climbed as much as 730 points, or 0.95%, to an intraday high of 76,883.14.
The Nifty touched a session high of 24,005.75, up 132 points, or 0.55%, from its previous close, before giving up some of its gains.
Among sectors, the Nifty Metal index was the strongest performer, rising more than 1%, followed by financial services excluding banks.
Technology and health care stocks came under pressure. The Nifty IT index fell 0.47%, while the Nifty Pharma and Nifty Healthcare indices declined 0.68% and 0.87%, respectively.
The India VIX, a measure of expected market volatility, dropped 6.24% to 10.63.
Market analysts said equities benefited from reduced expectations of an imminent Fed rate increase, though profit-taking and geopolitical tensions in the Middle East kept the advance in check.
Expectations that U.S. core inflation could ease slightly in August may strengthen the case for the Fed to keep interest rates unchanged and help stabilize bond yields, analysts said.
Buying remained strong in parts of the broader market, with small-cap indices reaching fresh intraday record highs.
Analysts said strong corporate earnings, resilient economic growth and robust domestic demand continued to support investor confidence in smaller companies and other parts of the broader market.
The Indian rupee also strengthened, trading at 94.48 against the U.S. dollar, up 0.09%, supported by fresh foreign currency non-resident deposit inflows that improved dollar liquidity. (Source: IANS)
