Indian stock indices ended the week higher, breaking a five-week losing streak and the government bond yields jumped marginally on Friday but closed the week slightly lower.

The markets took the first quarter GDP data in their stride. India’s April-June GDP growth was at 7.8%, which is a sharp improvement from 6.1% in the January-March quarter.

In non-financial news, India successfully launched its solar mission during the week.

Indian Markets Last Week:

Stocks went up on Friday and ended the week higher, with Metal, IT, Auto, and Banks leading the way. This ended a five-week losing streak and came after data showed that the economy grew at its fastest rate in a year in the April-June quarter. Nifty 50 went up by 0.88% and Sensex went up by 0.77% for the week. In the five weeks since July 20, when they hit record highs, both had gone down.

Yields rose slightly on Friday as debt auctions increased supply, while market participants shrugged off GDP data that was mostly on expected lines. In the April-June quarter, India's GDP climbed 7.8% annually, up from 6.1% in the March quarter. Investors will keep an eye on Federal Reserve meet in September and would clarify the next steps.

The rupee ended Friday firmer, although off the day's high, as dollar demand from importers weighed on the local currency. Despite its gains on Friday, the rupee was down marginally in the week. Weak U.S. economic data that reduced the likelihood of more Fed rate hikes, the dollar index fell on Friday, bringing the week's loss to 0.54%.

Global Markets Last Week:

US stocks closed higher with the S&P 500 jumping 2.50%, Dow rose 1.43%, and Nasdaq rose 3.25% for the week. A rise in unemployment strengthened expectations of deferment in interest rate hikes this month. Streaming firm shares fell due to a Disney-Charter Communications fee dispute. The US Labour Department reported 3.8% unemployment in August and slower pay growth. Though July data was cut down to 157,000 jobs, nonfarm payrolls climbed more than predicted.

US treasury yields climbed on Friday, reversing earlier dips following a mixed August jobs report, as investors reduced positions ahead of the long holiday weekend. The bond market in the US will be closed on Monday for Labour Day. The non-farm payrolls report for August showed that the largest economy in the world added more jobs than predicted last month, but the unemployment rate went up and wage inflation went down a little.

The US dollar went up against the euro and the Japanese yen on Friday after the August jobs report showed that the job market was still strong, even though there were some signs that it was getting worse. During the week, the US dollar had gone back and forth.

Corporate Bonds

Secondary Market

Yields were stable across tenures last week due to a lack of fresh cues and partly because India's GDP growth rate of 7.8% for the April-June quarter met market participants' expectations. Trade was limited to shorter-term NCDs, with mutual funds actively dealing in the secondary market.

Outlook For This Week

Stocks may rise Monday on expectations that US Fed may not raise interest rates at its September meeting. There are also expectations that Fed may not hike rates again in the current interest rate cycle

Yields on government bonds are likely going to be little changed in the absence of big cues.

In Other News

• Moody's, Morgan Stanley, Nomura raise India's FY24 GDP growth forecast.
• GST mop-up rises 11% on year to 1.59 trln rupees in August.
• India August manufacturing PMI 58.6 vs 57.7 in July.
• July services exports at $26.23 bln, up 8.1% on year.
• RBI says 93% of 2,000-rupee notes outstanding on May 19 back with banks.
• Enforcement Directorate arrests Jet Airways Founder Naresh Goyal in bank fraud case.
• CCI approves merger of Tata SIA Airlines into Air India.
• India Apr-Jun GDP growth rises to 4-quarter high of 7.8%.
• India CPI-IW inflation at 43-month high of 7.54% in July.
• India Apr-Jul fiscal deficit 6.06 trln rupees, up 78% YoY.
• India Jul eight core industries' growth at 8.0% vs 8.3% in June.
• Cabinet OKs cutting domestic LPG prices by 200 rupees per cylinder.
• See domestic coking coal production at 140 mln tn by 2030, says govt.
• SEBI enhances cybersecurity norms for market infra institutions.
• CRISIL pegs FY24, FY25 road, renewable energy invest at 13 trln rupee.
• Govt imposes 20% export duty on parboiled rice with immediate effect.
• NTPC to invest 155.3 bln rupees in stage-II of Lara power project.
• Maruti Suzuki CFO Ajay Seth to retire Dec 31, Arnab Roy to take over.
• Maruti Suzuki to spend 450 bln rupees to double mfg capacity by FY31.
• Will remain chairman of RIL for five more years, says Mukesh Ambani.
• Jio Financial to tie up with global players to enter insurance space.
• RIL Ambani says marquee investors showing interest in Reliance Retail.
• SEBI probe likely to suggest no major lapses by Adani group companies.
• US employers added 187,000 jobs in Aug in sign of a still-resilient labour market.
• Fed seen likely done with rate hikes as job market cools.
• US consumer spending accelerates; monthly inflation rates cooling.
• US second-quarter economic growth revised lower as inventories drop.
• US companies add 177,000 jobs, smallest gain in five months.
• US labour market loses steam as job openings, resignations decline.
• China banks to cut mortgage, deposit rates in stimulus bid.
• Powell signals no retreat, no surrender.
• ECB's Lagarde says interest rates to stay high as long as needed to defeat inflation.
• BoJ chief says strategy backed by below-target inflation.