Indian Equities Tumble Amid Rising US Bond Yields and Rate Hopes

Indian equities declined by about 1% this week due to elevated global bond yields and expectations of tighter US monetary policy. The Sensex and Nifty 50 indices recovered marginally on Friday, ending at 76,515.43 and 23,897.70, respectively.

The 10-year US Treasury yield rose above 4.8% this week amid expectations of higher US inflation and a rate hike at the upcoming Federal Open Market Committee meeting. This triggered heavy foreign selling in the first half of the week.

Markets recovered on Friday after Fed governor Christopher Waller indicated he would support keeping interest rates unchanged at the next policy meeting. However, the initial optimism faded as the Nifty succumbed to profit booking near the 24,000 mark.