Indian shares rebounded yesterday with Sensex rising 403 points to 35,756, ending a nine-day losing run. The broader Nifty settled at 10,735, up 1.25%.
Global markets have rallied over the past few days as investors bet the latest round of talks between the US and China would yield a trade deal, putting an end to a protracted tariff war.
Further lifting global stocks, US President Donald Trump said on Tuesday that trade talks with China were going well and suggested he was open to pushing off the deadline to complete negotiations, saying March 1 was not a “magical” date.
Tariffs on $200bn worth of Chinese imports are scheduled to rise to 25% from 10% from March 1 if the world’s two largest economies do not settle their trade dispute.
“For Nifty, 10,600 is an important support region. In the absence of any key price triggers, that has acted as temporary bounce point,” said Anand James, chief market strategist at Geojit Financial Services, adding that the market is also tracking progress in the China-US talks.
The US Federal Reserve will release the minutes from its January meeting. The RBI is scheduled to release the minutes of its February meeting today.
IT stocks bounced back after two days of losses. Shares of Infosys rose 2%. Financial stocks such as Yes Bank, SBI and energy stocks such as Reliance Industries were also among the biggest gainers. Yes Bank advanced 2.5% while RIL rose 1.5%. Metal stocks also posted strong gains with Vedanta and Tata Steel both surging over 4% each.
Meanwhile the rupee yesterday strengthened against the US dollar, tracking gains in other Asian currencies versus the greenback.
The rupee was trading at 71.15 a dollar, up 0.30% from its previous close of 71.36. The currency opened at 71.27 a dollar, touching a high 71.13 and a low 71.34.
The 10-year bond yield stood at 7.34%, lower than previous close of 7.369%. Bond yields and prices move in opposite directions.
So far this year, rupee has weakened 1.92% against US dollar, the worst performer among Asian currencies, while foreign investors have sold $91.34mn and $476.78mn in equity and debt markets, respectively.
Other Asian currencies were trading mostly trading higher against US dollar. China renminbi gained 0.5%, Philippine peso 0.454%, South Korean won 0.415%, Indonesian rupiah 0.413%, China Offshore 0.311%, Malaysian ringgit 0.251%, Thai baht 0.216%, Taiwan dollar 0.075% and Singapore dollar 0.059% . However, Japanese yen lost 0.198% and Hong Kong Dollar 0.009%.
The dollar index, which measures the US currency’s strength against major currencies, was trading at 96.539, up 0.02% from its previous close of 96.520.