Indian equity benchmarks rose on Tuesday, halting a three-session losing streak, buoyed by a recovery in Chinese equities after new government initiatives to support the beleaguered real estate subsector there boosted sentiment.
As the dollar pulled back from strong overnight gains on Tuesday, concerns persisted that Beijing could once again impose severe Covid restrictions that could further disrupt supply chains and keep investor sentiment towards risky assets in check would keep.
The BSE Sensex index rose 274.12 points, or 0.45 percent, to close at 61,418.96, and the broader NSE Nifty index rose 0.46 percent, or 84.35 points, higher to finish at 18,244 .20.
Both benchmarks had fallen in the previous three sessions.
IndusInd Bank, NTPC, UltraTech Cement, Titan, Infosys, Tech Mahindra, Tata Consultancy Services and Larsen & Toubro were some of the top performers of the Sensex package.
The lagging companies were Nestle, Bharti Airtel, PowerGrid, HDFC Bank and Kotak Mahindra Bank.
Global equities rallied higher, recouping some of the previous day’s losses as investors’ heightened risk appetite fueled inflows into equities and commodities.
The MSCI All-World stock index rose 0.2 percent, on track to post a second consecutive month of gains in what would be the longest winning streak since late 2021.
Asian stocks recovered from losses earlier in the day and European stocks rallied, while US futures faltered as investors analyzed the Federal Reserve’s statements on rate hikes and evaluated the effect of Covid infections in China.
The MSCI All-World stock index rose 0.2 percent, putting it on track to post a second consecutive month of gains in what would be the longest winning streak since late 2021.
Fed officials have maintained their unwavering commitment to fighting inflation. However, Cleveland Fed President Loretta Mester said she is willing to delay the pace of rate hikes.
In contrast, San Francisco Fed President Mary Daly said authorities should be aware of the delays in communicating policy adjustments.
“In a year like this, it is so difficult and often a silly message to read too much into a speech by a Federal Reserve official,” Sarah Ponczek, financial advisor at UBS Private Wealth Management, told Bloomberg Television.
“The reality is that we expect the Federal Reserve to probably still raise interest rates in December.”
In the commodity market, oil prices rose on Tuesday after Saudi Arabia denied a media story that it was considering an increase in oil production with OPEC and its allies.
“Markets remain subject to even greater volatility due to a total lack of market liquidity, as was all too evident in crude oil futures, as they pounced on the WSJ narrative that suggested Saudi Arabia at the meeting of December could propose a very surprising increase in OPEC production, only to reverse completely when denied,” ADM Investor Services Chief Global Economist Marc Ostwald told Reuters.
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