The US bond market remains under pressure, with bond prices falling and yields rising. Indian bonds are also witnessing weakness, while crude oil prices are approaching $94 a barrel. Despite these concerns, the Indian equity market is expected to open higher today.
Gift Nifty, a key indicator of the opening trend for Indian equities, closed at 24,293 on Wednesday night at GIFT City. It rose to 24,357 this morning, pointing to a positive start for the Indian market.
The US Treasury market turned turbulent again after a brief respite. Bond prices fell and yields rose despite US Treasury Secretary Scott Bessent's assurances that the government would increase buybacks of Treasury securities.
The yield on the 30-year US Treasury bond has climbed to 5.252 percent. The market remains concerned about the country's widening fiscal deficit, despite Bessent's assurances that the deficit will be contained.
The concerns extend beyond government borrowing. Heavy corporate investment in artificial intelligence and the availability of Japanese government bonds at relatively attractive prices are also influencing global bond flows.
Persistent selling pressure in US Treasuries could spill over into equities and trigger wider financial repercussions. The renewed bond-market turbulence comes amid growing debate over whether excessive investment in AI could be creating a bubble.
The renewed weakness in the bond market weighed on Wall Street on Thursday. Assurances from the US Treasury Secretary that the fiscal deficit would be kept under control failed to reassure investors.
The Dow Jones Industrial Average fell 703.84 points, or 1.32 percent, to close at 52,759.21. The S&P 500 dropped 66.82 points, or 0.87 percent, to 7,641.16, while the Nasdaq Composite declined 263.93 points, or 1 percent, to 26,213.17.
US stock futures, however, were marginally higher this morning. Dow futures were up 10 points, or 0.02 percent, S&P 500 futures gained 5 points, or 0.07 percent, and Nasdaq futures rose 44 points, or 0.15 percent.
Indian equities posted a strong recovery on Thursday after seven consecutive sessions of losses. All major sectoral indices advanced, with the market largely shrugging off concerns over rising crude oil prices and the possibility of a repo rate hike by the Reserve Bank of India in the next quarter.
Foreign investors remained sellers, recording net sales of ₹583.36 crore in the cash market. Domestic institutional investors, however, made net purchases worth ₹3,537.71 crore.
The Sensex gained 628.04 points, or 0.82 percent, to close at 77,537.72. The Nifty 50 rose 153.55 points, or 0.64 percent, to 24,231.85. The Bank Nifty advanced 256.15 points, or 0.45 percent, to 57,495.90.
The Nifty Midcap 100 rose 262.80 points, or 0.41 percent, to 63,671.55, while the Nifty Smallcap 100 gained 134.30 points, or 0.68 percent, to 19,841.45.
Market breadth was positive. On the BSE, 2,373 stocks advanced against 1,951 declines. On the NSE, 2,094 stocks gained while 1,394 fell.
Sugar stocks remained in demand after the government allowed duty-free imports of 1 million tonnes of sugar. Balrampur Chini, Shakti, Rana, Rajshree, Shree Renuka, Ponni, Dalmia, Avadh and Dwarikesh were among the major gainers, with several stocks rising as much as 20 percent.
Indian ADRs traded in New York were mixed. HDFC Bank gained 0.78 percent during regular trading and another 0.26 percent in extended trading to close at $23.40.
ICICI Bank rose 0.78 percent during regular trading and gained another 1.11 percent in extended trading to end at $30.
Infosys fell 1.66 percent during regular trading but recovered 0.25 percent in extended trading to close at $11.86.
Wipro declined 2.05 percent during regular trading and slipped another 0.08 percent in extended trading to close at $1.908.
European markets also remained under pressure on Wednesday. The FTSE 100 in the UK, however, managed a marginal gain following survey data indicating an improvement in consumer confidence.
Asian markets were mixed this morning. South Korea's Kospi and Japan's Nikkei fell about 1 percent each, while Australia's market edged lower.
Hong Kong's Hang Seng gained 0.65 percent, while the Shanghai Composite declined 0.50 percent. Taiwan's Taiex advanced.
Gold prices were volatile amid uncertainty in the bond market and the direction of interest rates.
Gold fell $3.70 an ounce on Thursday to close at $4,520.20. It slipped to around $4,510 this morning before recovering to $4,535.
Higher interest rates generally reduce the appeal of non-yielding assets such as gold, while lower rates tend to support demand. Market concerns over a possible increase in interest rates appear to be easing.
In Kerala, 22-carat gold jumped ₹3,120 per sovereign to ₹1,16,800.
Silver gained 1.60 percent on Thursday to close at $67.96 an ounce and rose further to $68.20 this morning.
Platinum stood at $1,843, palladium at $1,319 and rhodium at $8,550.
International rubber prices edged up, while Kerala prices remained unchanged.
In Bangkok, RSS 1 rose to $281.10 per quintal and RSS 3 to $277.60. In Kerala, RSS 4 remained at ₹27,400 per quintal.
Industrial metals moved in different directions.
Copper slipped 0.08 percent to $14,169.20 a tonne, while aluminium fell 0.38 percent to $3,199.03. Zinc, lead and tin gained, while nickel declined.
Cocoa prices edged higher on Thursday to $6,010 a tonne. Ghana's cocoa board expects production to fall 13 percent because of adverse weather conditions, while production in Ivory Coast is expected to decline by more than 10 percent.
The two countries are the world's largest cocoa producers. Hedge Point Global Markets expects the global cocoa surplus to fall 66 percent to 111,000 tonnes in 2026-27.
Arabica coffee gained 0.03 percent to $3.283 a pound amid concerns that El Niño could reduce production.
Palm oil prices continued to rise. The market expects prices to cross 5,000 Malaysian ringgit a tonne, supported by lower production and increased use of palm oil for biodiesel in Indonesia. Palm oil gained 1.39 percent on Thursday to ₹4,961 Malaysian ringgit a tonne.
The US Dollar Index closed at 98.90 on Thursday and slipped to 98.83 this morning.
The euro rose to $1.1688 and the pound to $1.364. The Japanese yen stood at 159.04 to the dollar, while the Chinese yuan strengthened to 6.72 per dollar.
The yield on the 10-year US Treasury rose to 4.704 percent this morning, while the 30-year yield climbed to 5.252 percent.
The Indian rupee ended Thursday slightly stronger, with the dollar falling four paise to ₹95.71.
In the overseas forward market, the dollar was trading at ₹95.74 this morning.
The Chinese yuan strengthened to ₹14.24 and the euro to ₹111.82.
Crude oil prices continued to rise, with Brent crude moving above $93 a barrel.
Brent crude gained $2.16 on Thursday to close at $93.78 a barrel. It eased slightly this morning before recovering to $93.82. West Texas Intermediate crude was trading at $86.75.
Cryptocurrencies continued their sharp rally amid renewed optimism over regulatory developments in the US.
US President Donald Trump has reportedly been discussing legislation aimed at creating a more crypto-friendly regulatory framework. A bill introduced last year had been stalled in the Senate.
Bitcoin surged more than 9 percent to above $74,750. Ether jumped 13 percent to above $2,360, while Solana gained 7 percent to above $89.
Sensex 77,537.72 +0.82%
Nifty 50 24,231.85 +0.64%
Bank Nifty 57,495.90 +0.45%
Nifty Midcap 100 63,671.55 +0.41%
Nifty Smallcap 100 19,841.45 +0.68%
Dow Jones 52,759.21 -1.32%
S&P 500 7,641.16 -0.87%
Nasdaq 26,067.17 -1.00%
Dollar ₹95.71 -₹0.04
Gold (ounce) $4,520.20 -$3.70
Gold (sovereign) ₹1,16,800 +₹3,160
Brent crude $93.78 +$2.16
