Indian stocks closed higher on Friday, with the benchmark index posting its best monthly performance since July, as the local market emerged as a safe haven amid a global selloff in technology shares.
The NSE Nifty 50 index rose 0.5%, while the small-cap index fell 2%. The Nifty gained 2% this month, ranking among the top performers among major Asian benchmarks. In contrast, regional benchmarks in markets dominated by AI trading, which were dragged down by the tech selloff, fell about 6% over the same period.
The Nifty's monthly outperformance relative to its emerging-market peers was the strongest since 2011, while Brazilian and South Korean stocks suffered heavy selling during the same period. India's lack of significant technology hardware and semiconductor stocks has shielded it to some extent from the global selloff.
Meanwhile, there are signs of a tentative return by overseas investors, who net bought more than $1.2 billion of Indian stocks in the week through Wednesday.
Sudeep Bandyopadhyay, chairman of Inditrade Capital, said: "India is being called the 'anti-AI trade,' and October offered a glimpse of that. But it's too early to start celebrating. The biggest concern is oil. Oil prices at around $117 a barrel are not good for India. Unless geopolitical fundamentals improve, these market moves may prove temporary."
High oil prices weighed on market breadth. The Nifty Smallcap 250 index fell nearly 6% in October, its worst performance in seven months, while the mid-cap index dropped 3.4%.
Thanks to the blockbuster listing of Jio Platforms Ltd. following India's largest-ever IPO, India became the world's largest IPO market in October. Market compilation data show that Indian companies raised about 455 billion rupees ($4.8 billion) through IPOs during the month, exceeding the $2.1 billion raised in the United States through Thursday and $1.5 billion in Hong Kong.
On Friday, fast-fashion retailer Trent Ltd. and airline IndiGo were among the leading gainers in the Nifty 50. For the full month, Tata Consultancy Services Ltd. and Infosys Ltd. led the advance.
Even so, the Nifty is still down nearly 12% year to date, compared with gains of more than 50% in Taiwan's stock market and 36% in South Korea's Kospi index.
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