Market optimism continues to dominate sentiment, with investors confident that the upward momentum will hold. Signals from the US and Asian markets are expected to lend further support, and the decline in crude oil prices is adding to the favourable mood. Optimism was strengthened after the commerce ministers of both India and the US indicated that a trade agreement would be signed soon.
Reports suggested that US President Donald Trump himself hinted that a deal could be finalised within weeks, and this has given a notable boost to Indian equities today. Nevertheless, the geopolitical situation in West Asia and Ukraine remains tense, with no signs of resolution.
India’s retail inflation figures for August are due later this evening, and analysts expect an increase from July’s 1.55% to around 2.2%. In the US, data released yesterday showed higher consumer price inflation along with a rise in unemployment claims, while labour market figures for August will be published later today. The derivatives market reflected mixed signals, with Gift Nifty closing on Thursday night at 25,187, briefly rising to 25,202 this morning before dipping lower, indicating a cautious but positive start for Indian equities.
European markets registered gains on Thursday after the European Central Bank decided to keep interest rates unchanged, which in turn supported the euro. Shares of Stellantis surged more than 9% after the company’s chief executive announced revamps of Jeep Cherokee and Ram truck models. Meanwhile, the European Union repeated its commitment to stop importing crude oil and natural gas from Russia by 2028, although the US continues to push for an earlier deadline.
Wall Street rebounded sharply yesterday, ending several days of weakness. The Dow Jones Industrial Average surged by more than 600 points to a record close, while the S&P 500 and Nasdaq also set fresh highs. US consumer inflation for August came in above expectations, with monthly growth at 0.4% and the annual rate at 2.9%.
Excluding fuel and food, core inflation rose by 0.3% month-on-month and 3.1% year-on-year. At the same time, weekly jobless claims rose unexpectedly to 263,000, the highest since October 2021. Despite this contrast of weaker employment data and stronger inflation, investors held firm in their belief that the Federal Reserve will cut rates next week, which fuelled the rally. US futures, however, were trading slightly lower today, with small declines across the Dow, S&P and Nasdaq.
Asian markets maintained their strength this morning, with Japan’s Nikkei up by 0.50% following a 10% jump in SoftBank shares that pushed the index to record highs yesterday. Australian and South Korean markets both gained 0.90%, while Chinese and Hong Kong equities also advanced.
Indian equities continued their winning streak for the seventh straight session on Thursday. After a volatile start, indices closed higher, with the Nifty finishing above the 25,000 mark. Sectoral performance was mixed: IT and auto stocks weakened, real estate shares remained flat, while the oil and gas index gained 1.10%. The Sensex added 123 points to end at 81,548.73, while the Nifty climbed 32 points to settle at 25,005.50
Bank Nifty, mid-caps and small-caps all closed with modest gains. Market breadth was largely balanced, with advances only slightly outnumbering declines across the NSE and BSE. Foreign investors sold shares worth ₹3,472 crore in the cash segment, while domestic institutions bought equities worth ₹4,045 crore. Analysts believe Nifty has support around 24,955 and 24,900, while resistance may be seen near 25,030 and 25,090.
Infosys Technologies announced the largest share buyback in its history, committing ₹18,000 crore to repurchase 2.19% of equity at ₹1,800 a share, representing a 19% premium to Thursday’s closing price. This marks its fifth buyback in eight years. The announcement initially drove the stock higher by 7%, although it later slipped to close 1.5% lower. Infosys ADRs in US trade showed small gains. Even so, the share remains down 20% for the year to date.
Gold prices eased slightly after a record-breaking run. In international trade, gold slipped $6 to close at $3,635.40 per ounce on Thursday, before rebounding to $3,646 this morning. Analysts suggest that after the current consolidation, the yellow metal may move towards $3,700.
In Kerala, 22-carat gold held steady at ₹81,040 per sovereign, while silver prices firmed to $41.85 per ounce. Industrial metals largely rose, with copper and aluminium gaining ground, while nickel declined.
Currency markets saw the dollar index fluctuate between 97.47 and 98.09 before closing at 97.53. The euro strengthened to $1.1735, sterling advanced to $1.3572, and the yen firmed to 147.19 per dollar. In India, the rupee slipped to a record closing low of 88.44 against the dollar, down 34 paise on the day.
Investors fear that widening trade deficits and heavy foreign outflows, which have already crossed $115 billion this year, will keep the rupee under pressure. The Reserve Bank continues to intervene, but only to smoothen volatility rather than defend any particular level.
Crude oil prices dropped by more than 1.5% as no new geopolitical flashpoints emerged. Brent crude closed at $66.37 per barrel before slipping further to $66.07 this morning. WTI traded at $62.05, and Murban crude at $69.90, while natural gas declined by 0.5%.
Meanwhile, cryptocurrencies extended their gains, with Bitcoin climbing to $115,500, Ethereum to $4,460, and Solana to $229.
