BENGALURU: India’s benchmark indexes rose about 1% on Wednesday, snapping a three-session losing streak and a day late in joining the global rebound as fears of a U.S. recession abated.
The NSE Nifty 50 index gained 1.27% to close at 24,297.5, and the S&P BSE Sensex added 1.11% to end at 79,468.01. They slid about 4% in the past three sessions amid a global rout as yen carry trades unwound and a weak U.S. jobs report sparked fears of a recession.
But while global markets rebounded on Tuesday after comments from key Federal Reserve officials eased some of the recession worries, the Indian markets’ recovery was stymied by profit booking near record-high levels. However, the markets joined on the second day of the global recovery.
“The rise in Indian markets shows that the knee-jerk reaction to U.S. recession fears and unwinding of the yen carry trade is subsiding,” said Raghvendra Nath, managing director of LadderUp Wealth Management.
“But the weakness over the last three sessions indicates that markets are going to be very aggressive in pricing unforeseen risks, which could lead to high volatility and episodes of profit booking.”
Indian shares rise tracking Asian peers; realty stocks advance
All the 13 major sectors gained.
The oil and gas and public sector companies gained about 3% and 4%, respectively, led by a 7.5% jump in Oil & Natural Gas Corp.
The state-run energy company reported a quarterly profit beat earlier this week and analysts said its sustained earnings momentum was a key positive catalyst.
The realty index jumped about 2% after the government relaxed new tax rules that would have likely led to higher capital gains tax on certain property sales.
Lupin surged 4.4% after the drugmaker reported a higher-than-expected profit for the June quarter.
Investors now await the Reserve Bank of India’s commentary on monetary policy at its meeting on Thursday during which it is expected to maintain interest rates.
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