Stock Market Today: Equity markets swung in trades on Friday as boost from JP Morgan’s decision to include Indian bonds in its Emerging Market index weathered weak global sentiment.
The S&P BSE Sensex gyrated 493 points intraday, before settling at 66,008, down 221 points or 0.33 per cent. The Nifty50, on the other hand, closed at 19,674, down 68 points or 0.34 per cent.
Wipro, Ultratech Cement, Dr Reddy’s Labs, Cipla, Bajaj Auto, Power Grid, HDFC Bank, Divis Labs, and UPL were among the top large-cap laggards, while Star Health, Glenmark Pharma, Astral, EKI, Jupiter Wagon, and RattanIndia Power were the losers in the broader market space.
Index wise, the BSE MidCap and SmallCap indices settled in-line moxed with a loss of 0.17 per cent and a gain of 0.06 per cent, respectively.
Sectorally, the Nifty PSU Bank jumped the most, rising 3.5 per cent, amid hopes that Indin bonds’ inclusion in JPM index would boos ttheir bond portfolios. Besides, the Nifty Auto index was the other notable gainer, up 0.21 per cent. On the downside, the Nifty Pharma fell 1.5 per cent.
Dr. V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services, said: “The Fed’s hawkish pause message has created a global risk-averse sentiment in global equity markets. The spike in the dollar index to 105.52 and the US 10-year bond yield shooting up to a 16-year high of 4.5 % are negative for equity markets, particularly emerging markets. The FIIs have reversed their ‘Buy India strategy’ which they have been following in the last 3 months with selling to the tune of Rs 16934 crores in September through 21st. Countering this negative trend is the hugely positive news of JP Morgan including India in the Emerging Market Bond Index with a weightage of 10% from June 2024 onwards. This will reduce bond yields and the consequent decline in the cost of borrowing will boost the bottom line of companies.”
“In the near-term, FIIs may press further selling in response to rising US bond yields. If this happens it will open up opportunities for investors to buy quality large-caps, particularly banking stocks which will benefit a lot from the bond inclusion,” he added.
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