Indian benchmark equity indices concluded Friday’s trading session in negative territory, pulling back from a seven-month high achieved in the previous session.
A sharp reversal in domestic technology stocks was the primary driver behind the market’s downturn.
uHowever, the losses were somewhat cushioned by robust gains in realty, media, auto, and consumer goods sectors, underscoring a mixed sentiment across Dalal Street.
The Nifty 50 index ended the day with a modest cut of 42 points, or 0.17%, settling just above the psychologically important 25,000 mark at 25,019.
The BSE Sensex experienced a more pronounced decline, falling by 200 points, or 0.24%, to close the session at 82,330.
Despite the day’s softness, both headline indices managed to wrap up the week with healthy gains exceeding 4%.
The positive momentum was even more pronounced in the broader market segments, with the Nifty Midcap 100 index rising by an impressive 7.21% for the week, and the Nifty Smallcap 100 rallying by an even sharper 9%, indicating strong investor appetite beyond the blue-chip counters.
Asia-Pacific navigates economic signals
Across the wider Asia-Pacific region, markets presented a mixed picture on Friday as investors digested Japan’s latest gross domestic product figures and awaited a slate of other economic data releases.
Japan’s benchmark Nikkei 225 traded relatively flat to close at 37,753.72, while the broader Topix index added a marginal 0.05% to finish the day at 2,740.45.
This came after data revealed that Japan’s economy contracted by 0.2% quarter-on-quarter for the three months ending in March.
This figure was slightly more pronounced than the 0.1% contraction economists polled by Reuters had anticipated.
The economic data emerged at a sensitive time, with Japan currently engaged in trade negotiations with the US, where initial talks have yet to yield a conclusive agreement.
Market analysts noted the potential implications of Japan’s weaker GDP.
“A weak outcome for Japan’s GDP can weigh on the Bank of Japan’s rate hike pricing and push USD/JPY up towards resistance at 148.13,” Commonwealth Bank of Australia wrote in a note.
The Japanese yen was trading at 145.52 against the US dollar.
Elsewhere in the region, Australia’s benchmark S&P/ASX 200 added 0.56% to close at 8,343.7.
South Korea’s Kospi closed 0.21% higher at 2,626.87, though its small-cap counterpart, the Kosdaq, lost 1.11% to close at 725.07.
India’s Nifty 50, as mentioned, declined 0.26% on the day.
Hong Kong’s Hang Seng index slipped 0.43%, while mainland China’s CSI 300 dipped 0.46% to close at 3,889.09.
Japan sees record foreign inflows amid trade shifts
Looking towards US markets, stock futures hovered near the flatline.
This followed a notable four-day rally in the S&P 500, spurred by temporary tariff cuts agreed upon by the US and China, alongside encouraging inflation reports.
Futures tied to the Dow Jones Industrial Average added a modest 32 points, or 0.08%. S&P 500 futures slipped slightly by 0.03%, while Nasdaq 100 futures inched down 0.07%.
Overnight in the United States, the three major averages closed with mixed results.
The S&P 500 climbed for a fourth consecutive session, adding 0.41% to end at 5,916.93, further extending its weekly gains.
The Dow Jones Industrial Average also rose, adding 271.69 points, or 0.65%, to close at 42,322.75.
However, the tech-heavy Nasdaq Composite underperformed, slipping 0.18% to settle at 19,112.32.
An interesting counter-narrative emerged from Japan, which saw record foreign inflows into its equities and long-term bonds in April.
This surge occurred as investors reportedly sought alternatives to US markets following former President Donald Trump’s broad trade salvos.
According to government data, overseas investors purchased 8.21 trillion yen ($56.6 billion) worth of Japanese equities and long-term bonds in April.
Morningstar noted that these net inflows were the largest for a calendar month since Japan’s finance ministry began collecting such data in 1996.
Corporate spotlight: Bharti Airtel dips on Singtel stake sale; Goldman Sachs upgrades Asian Ssocks
On the corporate front in India, shares of telecommunications firm Bharti Airtel fell 2.53%.
The decline followed an announcement from Singapore Telecommunications (Singtel) that it had divested 2 billion SGD ($1.54 billion) worth of Bharti Airtel shares.
Singtel stated that its effective stake in Bharti Airtel will decrease from 29.5% to 28.3% upon the completion of the sale.
Meanwhile, a more optimistic outlook for the broader region came from Goldman Sachs.
The investment bank lifted its 12-month price target for Asian stocks, citing improved growth prospects and a thawing in US-China trade tensions.
The bank revised its forecast for the MSCI Asia-Pacific ex-Japan index, setting a new target of 660, up from its earlier projection of 620.
“A more constructive tariff backdrop suggests flat returns over the coming three months rather than a drawdown, but the upside may be constrained by continuing uncertainty over where tariffs will settle,” Goldman Sachs’ strategists, led by Timothy Moe, wrote in a note.
The firm also upgraded its global equity outlook to neutral, reversing its earlier underweight position.
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