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Sensex and Nifty 50 gain as US bond yields rise on rate-hike signals
Despite gains in the headline indices, India’s mid and small-caps fell, while US 30-year yields hit a 2007 high of 5.239%.
India’s Sensex and Nifty 50 rose on 30 July, supported by select large-cap names such as Reliance, HDFC Bank, and Mahindra and Mahindra, according to LiveMint Markets. The Sensex gained 274 points, or 0.35%, to close at 77,928, while the Nifty 50 advanced 67 points, or 0.28%, to finish at 24,317.
Market breadth weakened as the advance-decline ratio tilted toward decliners, with more than 2,500 stocks down on the BSE versus nearly 1,700 advancers. LiveMint Markets also pointed to profit-taking in the mid and small-cap segments, with the Nifty Midcap 100 slipping 0.35% and the Smallcap 100 ending 0.56% lower.
The mixed tape reflected caution after the US Federal Reserve kept interest rates unchanged but signalled that rate hikes could begin as early as September. Expectations have increased for a September move as inflation risks are seen rising, with three of 12 policymakers voting for a rate hike on 29 July, and the Middle East conflict contributing to higher oil prices and market uncertainty.
Global rate expectations tightened further as US 30-year bond yields reached a 2007 high of 5.239%, while the 10-year yield rose 9 basis points to 4.71. LiveMint Markets said the 10-year and 30-year yields were on track for their biggest monthly jump since March, and noted that higher yields can be a headwind for emerging markets such as India by encouraging investors to shift toward safer debt.
Latest closeSensex 76,765.92 ▼0.1%