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Indian shares are set for a subdued start on Friday, tracking weakness in global peers, after data indicating strength in the U.S. labour market fuelled concerns of further monetary policy tightening.

India's GIFT Nifty on the NSE International Exchange was down 0.04% at 19,480.5, as of 8:14 a.m. IST.

Indian shares shrugged off weakness in global equities on Thursday, with blue-chips Nifty 50 and Sensex indexes hitting fresh highs. Both the benchmarks have gained over 1.6% so far this week.

The rally extended to broader markets as well, with smallcaps and midcaps clocking fresh 52-week and record highs, respectively.

But global cues worsened after data showed rise in the U.S. private payrolls, indicating strength in the labour market, fuelling fears of prolonged high interest regime and triggering a spike in bond yields across the world.

The minutes of the Federal Reserve's monetary policy on Wednesday showed that most members expected further policy tightening. The odds of a 25 basis points rate hike in July stood at 92.4%, compared to 86% on Wednesday.

Wall Street equities closed lower overnight, with the S&P 500 and Dow Jones Industrial Average posting their biggest single day fall since May.

Asian markets declined, with the MSCI Asia ex-Japan index losing over 1%, and the MSCI all country world price index logging its worst day in over two months. [MKTS/GLOB]

Foreign institutional investors bought 26.41 billion rupees ($319.4 million) of Indian equities on a net basis on Thursday, while domestic investors sold 23.52 billion rupees of shares, as per provisional NSE data.

Foreign inflows have entirely supported the rise in India's benchmarks over the last few months, according to analysts.

The Nifty 50 has risen 12.31% in fiscal 2024 so far. Foreign portfolio investors (FPIs) purchased equities worth over 1 trillion rupees over the period.

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