Sensex, Nifty Advance Led By PSUs

Indian shares rose notably on Friday as signs of a cooling U.S. economy pressured bond yields and bolstered expectations of potential rate cuts by the Federal Reserve.

Despite the Fed’s hawkish tone, economists continue to believe it is a matter of “when, not if” the U.S. central bank will eventually lower rates.

CME Group’s FedWatch Tool currently indicates a relatively modest 37.5 percent chance of a March rate cut but a nearly 100 percent chance rates will be lower by early May.

Investors also cheered Modi government’s interim budget that outlined plans to narrow the fiscal deficit in fiscal 2025.

The benchmark S&P BSE Sensex rose40.33 points, or 0.61 percent, to 72,085.63 ahead of the all-important U.S. jobs report later in the day, expected to show slower job growth.

The broader NSE Nifty index settled 156.35 points, or 0.72 percent, higher at 21,853.80.

NTPC, Adani Ports, ONGC and Power Grid Corp rallied 3-5 percent in the Nifty pack while Hindustan Unilever, HDFC Bank, HDFC Life, Axis Bank and Eicher Motors fell 1-2 percent.

Shares of oil marketing companies soared as crude prices headed for their biggest weekly loss since early November after reports that Hamas and Israel have come to an agreement on a ceasefire, a crucial step toward ending the conflict.

BPCL jumped 9.6 percent, IOC surged 9 percent and HPCL climbed 5.1 percent.

Paytm shares hit the 20 percent lower circuit limit for a second day running after the Reserve Bank of India imposed restrictions on its subsidiary Paytm Payments Bank, restricting it from accepting new deposits and carrying out credit transactions after 29 February.

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