MUMBAI: Indian stock markets could have another spectacular performance on Friday, with the SGX Nifty indicating a higher opening for the Indian benchmark indices. On Thursday, the domestic stock market reached a record high and the Sensex fell just short of the 60,000 level.
Asian stocks rose on Friday and Treasury yields eased optimism about the economic outlook and fears of a contagion from the debt crisis in China Evergrande Group.
Shares jumped in Japan and held steady in Hong Kong and China, where Evergrande’s fate remains uncertain amid a lack of announcement on dollar-bond interest payments due Thursday. Global market unease about Evergrande has subsided, but it is unclear whether Beijing plans to manage the fallout from any possible default on the word’s most indebted developer.
US futures rose after the S&P 500’s two-day rally since July. The Wall Street advance was led by economically sensitive sectors such as energy and financials, as investors took the view that a reduction in Federal Reserve stimulus shows confidence in a recovery from the pandemic. The dollar was stable and oil extended the climb.
Mining giant Vedanta has said it will delist its American depository shares and focus all trading of its equity shares on the BSE and NSE. Vedanta Ltd. in a filing to BSE said, “The company intends to deregister such ADS and underlying equity shares and to cease reporting obligations in accordance with the US Securities Exchange Act 1934, as amended … on doing so,” Vedanta Ltd said in a filing to BSE. .
IT consulting firm Accenture on Thursday forecast first-quarter revenue above analysts’ estimates, expecting strong demand for its cloud and security services as companies delay a return to offices due to the delta version. This may give rise to the shares of Indian IT companies.
The prospect of tighter monetary policy prompted a global sell-off in bonds. Long-term Treasury yields rose by the most in 18 months as traders pushed forward expectations of the first Fed rate hike by the end of 2022. The Bank of England opens the door for a 2021 rate hike, pushing down the 10-year gilt. Yields also jumped on sovereign debt in Australia and New Zealand.
Equity investors are taking heart from predictions that delta virus tensions and pandemic-related supply-chain shocks will provide only a temporary blow to the economic reopening. Central banks have also promised to gradually withdraw the stimulus. But the continued rise in long-term borrowing costs could be a risk to the upbeat picture if it erodes confidence in the prospects of recovery.
(Bloomberg contributed to the story)
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