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India Stocks Surge to Record Highs, But Foreign Funds Exit
27 Nov
Summary
- Indian equity indexes BSE Sensex and Nifty 50 reached record highs.
- Foreign investors have been net sellers of Indian stocks in November.
- The Indian rupee stabilized after touching a recent record low.
India's primary equity benchmarks, the BSE Sensex and Nifty 50, achieved historic highs on Thursday, showcasing a robust performance in the domestic stock market. This surge in equity values occurred even as foreign institutional investors maintained their stance as net sellers of Indian equities during November and for the entirety of the current year.
The Indian rupee exhibited stability, closing marginally lower against the U.S. dollar. This equilibrium was achieved through intermittent dollar sales by state-run banks, counteracting pressure from corporate debt repayments and importer hedging activities. Traders and analysts observe that depreciation risks persist for the rupee due to trade flow uncertainties and the ongoing U.S.-India trade talks.
Meanwhile, Asian currencies traded with mixed results, while the U.S. dollar index saw a slight increase but was on track for its worst weekly decline in four months. This downturn in the dollar was influenced by strong market expectations that the Federal Reserve will implement interest rate cuts next month, further bolstered by dovish commentary from Fed officials and benign U.S. economic data.
