Posting their first weekly gain in the month of January, Indian stock markets jumped nearly 2 per cent on Friday after the Bank of Japan’s bold move to adopt negative interest rates boosted the investor sentiment across the world.
After opening in negative zone at 24,347.31, the Sensex quickly staged a comeback and rallied to hit the session’s high of 24,911.90 on across-the-board buying, tracking the rally in other Asian markets like Shanghai and Hong Kong and commencement of the February derivatives series. The index settled 401.12 points or 1.64 per cent higher at 24,870.69. The NSE Nifty index reclaimed the 7,500-mark to hit a high of 7,575.65 intra-day, before closing at 7,563.55, up 138.90 points, or 1.87 per cent.
The rupee recovered by 45 paise to close at 67.78 per dollar on fresh selling of the US currency by banks and exporters in view of sharp recovery in equities. The rupee had dropped by 60 paise or 0.89 per cent in previous three trading days.
On a weekly basis, the Sensex recovered 435.03 points or 1.78 per cent and the
NSE Nifty rose 141.10 points or 1.90 per cent to log first weekly gain this year. However, the Sensex is still 4,800 points down in the last 12 months.
Global equities jumped, the yen tumbled and sovereign bonds rallied after the BOJ said it would charge for a portion of bank reserves parked with the institution, an aggressive policy pioneered by the European Central Bank (ECB). The sentiment got the needed boost after the fiscal deficit data for April-December 2015-16 presented a better picture of the government’s finance compared to the corresponding period last year.
Global stocks rise on BoJ decision
> Global equities jumped and the yen slumped after the Bank of Japan move. The Nikkei share index closed 2.8% higher. Shares on Wall Street and in Europe rose more than 1%, as did MSCI’s all-country world stock index , which gained 1.15%.
> Oil prices trimmed early gains in volatile trade on Friday. Prices rose early on prospects that a deal between major exporters to cut output could help reduce the oil glut. Brent hit as high as $35 a barrel, up about 25% from the 12-year lows hit last week.