Benchmark equity indices gained by about 2% backed by gains in financial and technology stocks.
The S&P BSE Sensex surged 1,181.34 points, or 1.95%, to 61,795 points. The Sensex gainers included HDFC (5.84%), HDFC Bank (5.62%), Infosys (4.51%), Tech Mahindra (3.64%) and TCS (3.43%). The NSE Nifty-50 index too surged 321.50 points, or 1.78%, to 18,349.70 points.
“Equity markets were strong across the world as the inflation data in the USA was better than expected,” said Sushant Bhansali, CEO, Ambit Asset Management.
“CPI inflation at 7.7% y-o-y cooled off significantly as compared to 8.2% y-o-y last month and market expectation of 7.9% y-o-y,” he added.
“This essentially has reduced the recession probability from 60% to 40% and has brought down the expectation of a peak benchmark rate from 5.25% to 5%. This is the first spark of good news from the USA in a long time and has been instrumental in lifting investor sentiments,” he said.
“We continue to remain constructive on the equity markets prospects, especially the emerging markets like India which will be driven by the strength of domestic consumption and the strength of the economy. The impact of the global recession has been fairly limited in countries like India,” Mr. Bhansali added. The rupee, too, appreciated 62 paise against the U.S. Dollar on Friday. The Indian unit closed at 80.78 to a dollar against its previous close of 81.40.
