market analysis: What helped D-Street end in the green after five sessions

Mumbai: Snapping their five-session losing streak, Indian stock indexes ended 1.3% up on Friday as investor sentiment was soothed by a pullback in US Treasury yields from 14-month highs. The indexes were in the red in the earlier part of the day with the Sensex falling as much as 1%, tracking global market weakness. The rebound in US bond prices saved the day for local equities–both benchmarks posting weekly gains for the first time after two weeks.

The Sensex ended 641.72 points up at 49,858.24 and the Nifty ended 186.15 points up at 14,744. Till Thursday, both indexes had dropped 4% in the preceding five trading sessions due to worries about surging US bond yields.

Yields on 10-year Treasuries rose to 1.7% for the first time since January 2020 on Thursday even after US Federal Reserve chairperson Jerome Powell reiterated Wednesday night his pledge to keep interest rates near zero, although he expected higher economic growth and inflation in the country this year.

Money managers said the rise in the US bond yields might be overdone.

“I am of the view that yields could cool down from here or remain where they are,” said Andrew Holland, CEO of Avendus Capital Alternative Strategies. “With a lot of slowdown in terms of shutdowns globally, I believe yields will come down globally and oil prices will go down.”
Foreign portfolio investors (FPIs) extended their purchases of local shares, pumping Rs 1,418.43 crore into the market. Domestic institutional investors also bought equities, to the tune of Rs 559.62 crore.

So far in March, foreign investors have put close to Rs 23,400 crore into India stocks after investing Rs 21,960 crore in February and Rs 14,500 crore in January.

On Friday, NTPC was the top gainer on the Sensex, ending 4.6% up, followed by Hindustan Unilever, Power Grid,

, ITC and UltraTech Cement that rose 2.4-4.4%. Larsen & Toubro and Tech Mahindra ended down 1.2% and 0.7%, respectively, among the main laggards on the index.