Indian market surges 4pc on optimism over US rates
Afp, Mumbai
Indian shares prices rose by as much as four percent in early trade Friday along with firmer Asian markets after the US Federal Reserve signaled it may pause in its rate hiking cycle, dealers said. The US Federal Reserve lifted its benchmark rate Thursday for the 17th straight time by a quarter point to 5.25 percent but ealers said markets interpreted its policy statement as a hint the Fed may pause in its credit tightening campaign and that any further hikes would depend on economic data. Mumbai's benchmark 30-share Sensex index rose 4.04 percent to an intraday high of 10,573.5 at the open, before retracing to 10,551.18, up 389.02 points or 3.83 percent at 0535 GMT. Retail investors and overseas funds bought index and mid-cap stocks while metal and engineering stocks were actively traded. "This is a knee-jerk reaction to signals the Fed may not hike interest rates (again) immediately," said Soumeel Chakravarthy, dealer at equity research firm Ambit Capital, cautioning "the markets may not sustain at these levels and could correct." India's Sensex index has been seesawing since May 10, caught up in worldwide turmoil over fears rising interest rates will slow global growth.
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