Indian stocks surged for the fourth week in a row led by financial companies, thanks to bullish sentiment bolstered by comments from the US Federal Chair on cutting interest rates sometime this year and Moody's favorable outlook on India's banking system. Indian government bond yields fell marginally as foreign investors stepped up purchases, while the rupee steadily strengthened against the dollar, reaching a six-month high. US stocks slumped last week due to Friday's sharp dive in Nvidia and technology shares. Treasury yields fell after the number of jobs in the US surpassed expectations by 275,000 in February. Nevertheless, the unemployment rate increased to 3.9 percent from 3.7 percent in January, and average hourly wages increased by 0.1 percent for the month and by 4.3 percent year-on-year.

Domestic Markets Last Week

• Indian stock indices rose for the fourth consecutive week. On Thursday, financial companies led indexes to a record high for the second straight session after the US Federal Chair's rate-lowering comments boosted optimism. Financial shares gained last week after Moody's Ratings affirmed India's banking system's outlook. On Tuesday, shares had declined led by technology shares.
• Government bond yields ended steady after falling slightly on Thursday as more global investors increased their buying, on views that February US non-farm payroll statistics will be weak. Yields were flat for most of the week, which has widened the spread relative to US treasuries.
• The rupee strengthened for the fourth week in a row against the US dollar and reached its highest level in six months last week. On Thursday, the rupee gave up some of its gains against the dollar after the Reserve Bank of India intervened to curb further rise due to an increase in dollar demand from importers.

Global Markets Last Week:

• US stock declined for the week as the bullishness in Nvidia's stock price frizzled out on Friday. The AI stock fell more than 5 percent in its worst session since late May last year after the US job growth exceeded projections by 275,000 in February. However, unemployment jumped to 3.9 percent from 3.7 percent in January. The volatile week ended with a fall for all three major indices.
• Treasury yields fell on Friday after the US jobs report made it even more clear that the Federal Reserve will start with rate cuts in the middle of the year. According to the Labour Department, the number of jobs in the U.S. grew faster in February, even though the unemployment rate rose and pay gains slowed down. The mixed report didn't rule out the possibility that the Federal Reserve will lower interest rates in June.
• The US dollar index fell the most in a week against the major basket of currencies since the middle of December because of changing expectations that the US Fed will cut interest rates in June. The change in sentiment came after Federal Reserve Chair Jerome Powell's recent comments on Thursday, which made it seem more likely that interest rates will go down in the coming months.

Corporate Bonds

Secondary Market

Yields were down by 4 basis points for up to 5-year corporate bonds as mutual funds stepped up buying in the secondary market for shorter tenure. Yields on 10-year and above papers were steady amid lackluster trade.

Outlook For This Week

Domestic shares may open range-bound on Monday and take further cues from the global market and will closely watch the rupee's movement against the dollar. Investors will await further macroeconomic data slated to be released this week such as industrial and manufacturing production data, and inflation data. Government bond yields are expected to ease tracking its US peers after the US jobs data released on Friday.

In Other news

• India-EFTA trade deal to bring in $100 billion investment in 15 years.
• Economic shocks hit consumption growth in the last decade, says Nomura.
• Forex reserves kitty jumps $6.55 billion to $625.63 billion: RBI data.
• Banks' lending rate hit a 46-month high in Jan; for fresh deposits in Aug.
• Gold price jumps 4 percent in one week on US Fed rate cut buzz.
• Tata Sons' net debt burden at eight-year low as cash reserves swell.
• Govt exempts certain payments to units in IFSC from TDS starting April 1.
• Moody's revised India's GDP growth forecast to around 8 percent for FY24.
• Foreign investors in tax soup for trading with borrowed money.
• India-UK trade talks are set to end; key issues remain.
• LS Polls: NDA to see landslide victory, but unlikely to cross 400 seat targets.
• Apollo Hospital unveils first ZAP-X brain tumour treatment in South Asia.
• China's consumer prices rise after months of deflation woes.