IT stocks accounted for a large portion of the day’s gains. TCS, Tech Mahindra, Infosys, HCL Technologies and Bharti Airtel led the Sensex gainers, each rising between 0.8% and 1.5%. The Nifty IT index climbed 1.4%, adding to Wednesday’s 0.8% gain, helped by a softer rupee and growing expectations of a US interest rate cut next week, both tailwinds for software exporters whose dollar revenues are rising in local currencies.
However, the financial figures proved to be an obstacle. The sector fell 0.1%, while heavyweight private lenders HDFC Bank and ICICI Bank fell around 0.3% each. Broader markets were subdued, with midcaps ending flat and smallcaps down 0.2%.
IndiGo operator InterGlobe Aviation fell 2.4%, extending its decline to a fifth straight session as flight cancellations continued to rise.
Expert views
Domestic markets closed flat amid mixed global cues and caution ahead of the RBI policy, said Vinod Nair, head of research at Geojit Investments, adding that early value-driven gains were held back by a record low rupee and continued FII outflows. “However, lower expectations of a rate cut from the RBI supported a mild rally in the currency, allowing the indices to stabilize heading into the close. IT stocks outperformed, supported by renewed optimism around possible Fed rate cuts and favorable currency tailwinds, which boosted investor interest in the sector,” Nair said.
Global markets
Japanese shares outperformed on Thursday, sparking an otherwise mixed session in Asia, after a government bond auction in Tokyo saw the strongest demand in more than six years. The rally helped calm nerves after a sharp sell-off in super-long Japanese government bonds earlier this week sent yields to record highs and roiled global bond markets.
The Nikkei 225 rose 2.2%, driven by a nearly 12% rise in industrial robot maker Fanuc Corp. In contrast, MSCI’s index for Asia-Pacific shares outside Japan was little changed, slowed by declines in South Korea and New Zealand. The US dollar also firmed after falling to a five-week low.
In early European trading, sentiment appeared firmer, with regional futures up 0.6%, while German DAX futures also rose 0.6% and FTSE futures rose 0.31%.
Rupee vs dollar
The Indian rupee recovered from a new record low on Thursday to end just below the 90 per dollar mark after dollar sales by several foreign banks, likely linked to inflows, helped halt a six-session slide. The currency briefly weakened to 90.42 early in the day before reversing course to close 0.2% stronger at 89.9750.
The US dollar index rose 0.1% to 98.99, breaking a nine-day losing streak after hitting its lowest level since October 29.
Rough impact
Oil prices moved higher on Thursday as Ukrainian attacks on Russia’s energy infrastructure raised the prospect of tighter supply, while stalled peace talks dampened hopes for a quick recovery of Russian barrels on global markets. Still, tepid demand and soft fundamentals kept the rally in check.
Brent crude rose 41 cents, or 0.65%, to $63.08, while U.S. West Texas Intermediate rose 45 cents, or 0.76%, to $59.40.
(with input from agencies)
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