Indian shares on track for higher open on lower Treasury yields, SEBI relief

Indian shares are poised for a higher opening on Friday, building upon their recovery from the prior session. This optimism comes from a decline in US Treasury yields and adjustments to the closing auction session by the local markets regulator, SEBI. As of 7:52 a.m. IST, GIFT Nifty futures stood at 23,082, signaling a favorable start for the Nifty 50 benchmark, which had closed at 22,997.35 the previous day.

Following a robust Thursday, both the Nifty 50 and BSE Sensex experienced their largest single-day gains in four months, driven by a resurgence in global AI trade and earnings-related sentiments. The Securities and Exchange Board of India announced on Thursday that it would utilize volume-weighted average prices from the final 30 minutes of regular trading to settle expiring stock and index derivatives contracts, reversing a previous decision to employ the closing auction session (CAS).

This change, welcomed by traders, is expected to decrease expiry-day volatility under CAS, benefiting brokers with orders below pre-CAS levels. Despite this positive outlook, the recovery might be precarious, as elevated oil prices and inflation concerns could keep investors wary, according to two analysts. Brent crude futures hovered near $106 per barrel, with investors monitoring Middle East risks and potential US actions to alleviate restrictions on the global "shadow fleet" of tankers.

On Thursday, foreign investors sold Indian shares valued at ₹52.85 billion ($555.99 million), amounting to $32.8 billion in disposals year-to-date. Asian equities opened higher by 1% on Friday, with renewed investor interest in the tech sector following a drop on Thursday and a decline in bond yields alleviating market pressure.