India's BSE Sensex finished about 0.5% up at 85,712.4 on Friday, the highest in over a week, extending gains from the previous session, as traders welcomed the RBI's 25 bps rate cut. The Reserve Bank of India (RBI) reduced its key benchmark interest rate for the first time in six months and implemented measures to enhance liquidity as benign outlook for prices provided room to further support growth. Rate-sensitive financials and autos spearheaded the rally, with SBI (+2.5%), Bajaj Finserv (+2.1%), Bajaj Finance (+1.8%) nad Maruti Suzuki (+1.8%) among the top performers. US-exposed IT stocks also continued to advance on rising bets of a Fed rate cut next week. On the opposite side, Hindustan Unilever (-3.4%), Eternal (-1.3%), Trent (-0.8%) and Sun Pharma (-0.8%) emerged as the biggest laggards. For the week, the index was flat.
US stocks closed higher on Friday with the S&P 500 up 0.2%, the Nasdaq up 0.4% and the Dow up 0.2% as a light PCE print and firmer Michigan sentiment reinforced odds of a 25bp Fed cut next week, with traders pricing roughly an 87% chance of a move. Core PCE rose 0.2% in September and the annual rate eased to 2.8% while Michigan showed improving confidence and softer near-term inflation expectations. Mega caps largely drove the advance with Alphabet (+1.2%), Meta (+1.8%) and Broadcom (+2.4%) leading the gains, while Microsoft added 0.5%, Tesla edged 0.1%, Apple slipped 0.7% and Nvidia eased 0.5%. Netflix fell 2.9% after unveiling the Warner Bros Discovery deal though losses narrowed on reports of regulatory scrutiny. Tech breadth broadened as XLK notched a tenth straight session and Salesforce jumped 5.3% on strong results, leaving the S&P up 0.4% for the week, the Nasdaq 0.9% higher and the Dow at 0.5%.
