Indian equities snapped a two-session losing streak on Tuesday, recovering partially as broader Asian equities edged up, tracking a late rally on Wall Street, with the Nasdaq ending sharply higher after Twitter agreed to Elon Musk’s purchase offer.
Twitter ended 5.6 per cent higher on news that Elon Musk, the world’s richest person, clinked a deal to pay $44 billion cash for the social media platform populated by millions of users and global leaders.
The BSE Sensex index jumped over 600 points to around 57,187, while the Nifty rose over 1 per cent to about 17,135 on Tuesday, after both the indexes fell over 1 per cent in the previous session.
On Friday, the 30-share BSE Sensex had plunged 715 points or 1.23 per cent to close at 57,197, while the broader NSE Nifty moved 221 points or 1.27 per cent lower to close at 17,172.
Still, global growth fears stoked by China’s stringent COVID-19 curbs and an expected streak of aggressive Federal Reserve tightening are likely to sap risk appetite and weigh on world equities.
The stringent lockdown in China, and its proliferation as cases spread to other big cities like Beijing, is weighing on the economic growth outlook and investment sentiment, Manishi Raychaudhuri, Asia-Pacific equity strategist at BNP Paribas, told Reuters.
“If the lockdown situation persists for longer,” it would impact China’s economy significantly and “also have an impact on the supply chains across the world,” he said.
What has pushed up the safe-have appeal of the dollar and rattled financial markets is the US Federal Reserve’s signals for a very aggressive monetary policy path, with investors fretting that it could derail the nascent global economic recovery.