Concerns over a possible bubble in the US artificial intelligence sector have eased slightly, though investors remain cautious. Markets are now watching for a key trade agreement announcement between India and the US, expected this week. Meanwhile, Washington’s decision to cut import duties on more than 200 agricultural products, including cashew and spices, has brought some relief. The move, aimed at cooling inflation, has improved market sentiment. Back home, political uncertainty following the Bihar election results has subsided, and second-quarter earnings have exceeded expectations — setting the stage for a positive opening in Indian markets.
Futures on the US and Indian indices pointed upward, while Asian markets moved in mixed directions, giving investors reason for optimism. Global crude oil prices have fallen, gold remains volatile, and the dollar has gained slightly. In GIFT City, Nifty derivatives closed at 25,962 on Friday night, later rising to 26,021, indicating a strong opening for Indian equities.
European markets ended lower on Friday as worries over an AI bubble persisted. Most indices declined by over 1%. Shares of Denmark-based pharma major Novo Nordisk fell 2.4% after shareholders approved changes to its board, amid growing challenges in the weight-loss drug segment — a stock that has already lost 52% this year. In the UK, signals that the Labour government may withdraw a proposed tax hike pushed down bond prices, while the pound also weakened.
After a shaky start, Wall Street bounced back on Friday, helped by buying at lower levels. Tech stocks, which had fallen sharply in recent sessions, led the recovery. The Nasdaq, which had dropped 1.9% earlier in the day, ended in positive territory. The S&P 500 erased most losses, while the Dow closed slightly lower. For the week, the Dow rose 0.3%, the S&P 0.1%, and the Nasdaq slipped 0.5%. Investors now await Nvidia’s results on Wednesday, which could decide the direction of tech stocks.
In corporate news, Walmart’s long-time chief executive Doug McMillon will retire in January after 12 years at the helm. He will be succeeded by John Furner, who currently leads the company’s US business. Under McMillon’s leadership, Walmart’s stock has surged 300%.
Economic data releases delayed by the recent US government shutdown are expected this week, along with September’s employment figures and the Federal Reserve’s meeting minutes.
On Friday, the Dow Jones Industrial Average fell 309.74 points (0.65%) to close at 47,147.48. The S&P 500 slipped 3.38 points (0.05%) to 6,734.11, while the Nasdaq Composite rose 30.23 points (0.13%) to 22,900.59.
Most Asian markets were lower as tensions between Japan and China escalated. Beijing issued a travel advisory discouraging trips to Japan, hurting tourism-related stocks. Japan’s economy contracted 0.4% in the September quarter — a smaller decline than feared. The Nikkei fell 0.5%, while South Korea’s Kospi jumped 1.78%. Chinese and Hong Kong indices opened lower.
Indian equities ended marginally higher on Friday, marking their fifth straight day of gains. Despite weak global cues, the market drew strength from the NDA’s strong performance in the Bihar elections. After a volatile session, indices turned positive in the final hour of trade.
Defence stocks led the gains, with Paras Defence rising 6.5%, Dynamatic Technologies 6.35%, Bharat Dynamics 6.13%, Garden Reach 5.61%, and Zen Technologies 4.78%. Kochi Shipyard gained 1.24%. Public sector banks, pharmaceuticals, FMCG, and healthcare stocks also performed well, while IT, metals, and autos declined.
The Sensex gained 84.11 points (0.10%) to close at 84,562.78, while the Nifty rose 30.90 points (0.12%) to 25,910.05. Bank Nifty advanced 135.60 points (0.23%) to 58,517.55. The Midcap 100 gained 0.08%, while the Smallcap 100 rose 0.38%.
Foreign institutional investors (FIIs) continued selling, with net sales worth ₹4,968.22 crore, while domestic funds bought shares worth ₹8,461.47 crore. For the week, foreign funds invested $30.5 million (₹2,700 crore) in Indian equities, mainly through IPOs.
Market sentiment remains optimistic, with bulls eyeing the 26,000 mark on Nifty. Analysts say a breakout above 26,000 could take it to 26,100–26,200, while support lies near 25,700.
Gold prices ended last week 2% higher but have been volatile since. Despite multiple attempts, the metal failed to hold above $4,200 an ounce and now finds strong support near $4,000. Expectations of a US rate cut in December have faded, with odds dropping from 95.5% earlier in the week to 55% by Friday. The Fed minutes due this week may offer fresh cues.
Spot gold fell 2.25% to close at $4,082.70 an ounce. Early Monday trading saw prices hover near $4,099. Silver also dipped to $50.85 after briefly touching $53.60.
All major industrial metals except zinc fell last week. Copper dropped 0.83% to $10,850.75 per tonne, aluminium fell 1.95% to $2,840.05, while zinc rose 2.35%. Rubber prices rose 0.76% to 173 cents per kg, while cocoa continued to slide, down 3.65% to $5,287 per tonne due to better crop yields in West Africa.
The dollar index rose to 99.36 after briefly touching 98.99. The euro fell to $1.1605, the pound to $1.315, and the yen to 154.59 per dollar. The rupee weakened eight paise to close at 88.74.
Crude oil prices retreated after rebounding on reports of resumed exports from a Russian Black Sea port that was hit by drone strikes. Brent crude dropped 1% to $63.76 per barrel, while WTI was at $59.45. Natural gas prices fell 2% to $4.47.
Cryptocurrencies remained under pressure amid rising volatility and large-scale selloffs by major funds. Bitcoin, which traded above $126,000 earlier, slipped below $95,000 last week, before stabilising near $94,700. Ether rose slightly to $3,115 after falling to $3,005, while Solana rebounded to $138 from $134.