Indian stocks significantly rose on Friday, driven by indications of a slowing U.S. economy which, in turn, put pressure on bond yields boosting chances of prospective rate cuts by the Federal Reserve. Economists, undeterred by the Fed's stern stance, maintain the U.S. central bank will inevitably decrease rates—it's simply a question of timing.
As per the CME Group's FedWatch Tool, while there's only a modest 37.5% chance of a rate cut in March, by early May, it's projected that the rates will almost certainly be lower. Investors also welcomed the Modi government's interim budget which plans to reduce the fiscal deficit by fiscal 2025.
Just before the critical U.S. jobs report, which is expected to suggest a slower job growth, the standard S&P BSE Sensex edged up by 40.33 points, an increment of 0.61%, to 72,085.63. Meanwhile, the broader NSE Nifty index ended 156.35 points higher, a 0.72% rise to 21,853.80.
NTPC, Adani Ports, ONGC, and Power Grid Corp saw a 3-5% hike in the Nifty pack. Meanwhile, Hindustan Unilever, HDFC Bank, HDFC Life, Axis Bank, and Eicher Motors witnessed a 1-2% drop. Shares of oil marketing companies rocketed as crude prices are set for their most significant weekly loss since early November. This follows reports of a ceasefire agreement between Hamas and Israel - a critical step towards ending the conflict. BPCL jumped 9.6%, IOC surged 9%, and HPCL climbed 5.1%.
However, Paytm shares took a hit for the second consecutive day, reaching the 20% lower circuit limit. This came after the Reserve Bank of India put restrictions on its subsidiary Paytm Payments Bank. After February 29, the bank was restricted from accepting new deposits and undertaking credit transactions.
