India’s benchmark indexes climbed in early trade on Thursday, led by gains in pharmaceutical stocks and heavyweight Reliance Industries, while lower US Treasury yields and a weaker dollar lent support.
The Nifty 50 and the BSE Sensex both climbed 0.5% each to 24,733.8 and 81,379.72 points, respectively, as of 10:25 a.m. IST.
Barring the state-run banks, all major sectors were in the green.
The broader, more domestically focussed smallcap and midcap stocks rose 0.8% and 0.5%, respectively. Dr Reddy’s Laboratories jumped about 3% on collaboration with biotech company Alvotech to develop cancer drug Keytruda’s biosimilar for global markets.
The stock pushed the pharma index higher by about 1%, making it the biggest sectoral gainer so far on the day.
Separately, Zydus gained 2.7% after its cancer drug partnership with Agenus and Glenmark added 2.3% after its myeloma drug delivered a high response in the phase 1 trial, boosting the sub-index further.
Reliance Industries added 1.3%, marking the second consecutive session of gains for the oil-to-telecom conglomerate.
Brokerage firm JP Morgan said Reliance Industries’ earnings for the next two years would be better compared with the last two due to growth expected in retail and telecom businesses.
The market’s overall positive momentum was bolstered by its Asian peers, which crept higher while the US dollar and Treasury yields languished.
The drop in yields will turn out to be good for emerging markets like India in the medium term, but the spike in trade and geopolitical uncertainty will keep the market within a range for the near term, said VK Vijayakumar, chief investment strategist at Geojit Investments.
Indian shares rise on optimism over trade negotiations, potential RBI rate cut
Yields move inversely to prices, and lower yields lead investors to seek higher returns in equities, boosting emerging markets like India.
Investors in India are waiting for the Reserve Bank of India’s (RBI) policy decision on Friday, when the domestic central bank is widely expected to cut key lending rates by 25 basis points for the third straight meeting.
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