Indian Shares Extend Gains For Second Day As Oil Prices Retreat

(RTTNews) - Indian shares rallied on Tuesday, extending gains from the previous session amid diminished expectations for another Federal Reserve interest-rate hike in October.

After U.S. job growth slowed more than expected in September, markets now see about a 20 percent chance of another Fed rate hike this month, down from roughly 70 percent a week earlier, according to CME FedWatch tool.

Falling oil prices and lower bond yields also helped ease concerns around inflation and interest rates.

Oil prices fell sharply today, with Brent crude prices falling nearly 2 percent to trade below $99 a barrel on signs of resilient Middle Eastern crude exports and the G7's announcement of a 100-million-barrel coordinated stock release.

Media reports suggested that Middle East crude exports are recovering toward pre-war levels despite continued risks to shipping.

Meanwhile, Euro zone bond yields fell sharply, helping reduce the spread between French and German 10-year yields.

The 10-year U.S. Treasury yield dropped 3 basis points to 5.280 percent, after having risen to 5.349 percent on Monday, the highest since 2002 amid rising inflation expectations.

On the economic front, investors cheered the results of a survey, which showed India's services activity strengthened in September on increasing demand amid receding inflationary pressures.

The benchmark 30-share BSE Sensex jumped 685.34 points, or 0.95 percent, to 73,067.81, tracking firm cues from global markets. The NSE Nifty index surged 220.35 points, or 0.98 percent, to 22,776.10 while the BSE mid-cap and small-cap indexes rallied 1.2 percent and 1.4 percent, respectively.

The market breadth was strong on the BSE, with 2,827 shares rising while 1,550 shares declined 246 shares closed unchanged.

Among the top gainers, Trent shares soared nearly 13 percent after the retail firm reported a 23 percent year-on-year surge in Q2FY27 standalone revenue.

Private sector lender Kotak Mahindra Bank climbed 3.6 percent after its Q2 business update highlighted strong credit deployment and deposit growth.

Axis Bank, Asian Paints, Eternal, Indigo, Reliance Industries and Hindustan Unilever rose 2-3 percent.