Gains across sectors – led by financial, metal and energy shares – supported the markets
Domestic share markets extended gains to a sixth straight day on Friday tracking rising Asian equities, following a major shift in stance by the US central bank to focus more on growth than inflation. The S&P BSE Sensex index climbed up as much as 0.68 per cent – or 264.85 points – to touch 39,378.32 in the first hour of trade, and the broader NSE Nifty 50 benchmark rose to as high as 11,634.55, up 0.65 per cent – or 75.3 points – from its previous close. Gains across sectors – led by financial, metal and energy shares – supported the markets.
At 9:59 am, the Sensex traded 0.46 per cent – or 181.26 points – higher at 39,294.73, while the Nifty was up 0.48 per cent – or 55.45 points – at 11,614.70.
Analysts awaited official data on the country’s GDP or gross domestic product in the April-June period due on Monday, for more clarity on the damage caused to the economy by the coronavirus pandemic and the resultant restrictions. (Also Read: Sensex, Nifty To Face Correction After 50% Rally Despite Covid-19, Says Poll)
Equities in other Asian markets recovered early sluggishness to move higher. MSCI’s broadest index of Asia Pacific shares outside Japan was last seen trading 0.34 per cent higher, while Japan’s Nikkei 225 benchmark was up 0.61 per cent.
On Thursday, Federal Reserve Chairman Jerome Powell laid out a monetary policy that aims for 2 per cent inflation on average so that too low a pace would be followed by an effort to lift inflation “moderately above 2 per cent for some time”. (Also Read: In A Big Shift, US Central Bank Rewrites Its Approach To Inflation, Jobs Market)
The change suggests the US central bank’s key overnight interest rate, already near zero, will stay there for potentially years to come as policymakers woo higher inflation.
Though Mr Powell’s comments were widely expected, some traders were disappointed that the US central bank did not reveal more details about how the new framework will work or provide any clues to what it will do at its next policy meeting.
