Indian stock market indices on Monday opened the new week's trade on a high, tracking Friday's Wall Street gains and supported by strong cues from global benchmarks.
"Wall Street's major indices increased by more than 2 percent on Friday as payrolls for December increased more than anticipated despite slower wage growth and weaker services activity," said Ameya Ranadive, Equity research analyst at Choice Broking.
Sensex jumped 850 points to regain the 60,000 mark and closed at 60,750. Nifty reclaimed the 18,000 mark to end at 18,101, a gain of 240 points.
The Nifty sectoral indices, led by IT - rising over 2 percent, were all in the green, except for consumer durables, the only index to close in the red.
"The United States economic data released on Friday is significant from the global market perspective. All data point to a strong but cooling U.S. economy which indicates the rising possibility of a soft landing for the U.S. economy," said V K Vijayakumar, chief investment strategist at Geojit Financial Services.
"The December jobs increase was 223000, the lowest in 2 years. The hourly wage increase slowed to 4.6 percent against the recent peak of 5.6 percent. All these point to cooling inflation and the possibility of the Fed going less hawkish in 2023," Vijayakumar added.
The U.S. Federal Reserve recently raised interest rates by 50 basis points (bps), preceded by four consecutive hikes of 75 bps. The central bank's policy rate is now in a target range of 4.25-4.50 percent, the highest level in 15 years. It was near zero in the early part of 2022.
For India, Vijayakumar said the sustained selling of stocks by foreign institutional investors has been a concern and advised investors to watch out for data.
So far, in January, foreign investors sold Rs 5,872 crore worth of equities in India, National Securities Depository data revealed, whereas in 2022, they sold Rs 121,439 crore worth of assets on a cumulative basis.
