India's stock benchmarks, trading near record high levels, are poised to inch higher on Friday, while other Asian peers declined after the U.S. jobs data failed to provide clarity on interest rate cuts.

The Gift Nifty futures were trading at 26,210.5, as of 07:47 a.m. IST, indicating that the Nifty 50 could open marginally above the previous session's close of 26,192.15.

Both Nifty and Sensex settled less than 0.5% below their all-time highs reached in September 2024 in the previous session.

The all-time high levels for domestic benchmarks are well within reach, with sentiment remaining positive due to improving earnings outlooks and stable flows, according to two analysts.

The ascent towards record-high levels marks a recovery for the blue-chips, which confirmed a correction in late 2024, dragged by weaker earnings, higher valuations, and sustained foreign outflows.

The recovery has been driven by a stable economy, benign inflation, tax cuts, and rate easing, which are expected to lift corporate earnings from the second half of fiscal year 2026.

Sustained domestic buying, as seen by record-high systematic investment plan contributions, has also helped markets come through the period of correction and absorb the foreign selling, amid trade and geopolitical uncertainties.

Foreign portfolio investors (FPI) remained net buyers of Indian stocks for the second straight session on Thursday, purchasing stocks worth 2.84 billion rupees ($32.02 million), while domestic institutional investors (DII) inflows remained at 8.24 billion rupees.

Other Asian markets slid 1.9%, after a 1% rise on Thursday, while Wall Street equities declined overnight after data showed acceleration in employment growth in September dampening hopes of a U.S. Federal Reserve rate cut in December.

Higher rates tend to make emerging markets such as India less attractive for overseas investors.

Concerns over inflated tech valuations also resurfaced, dragging U.S. stocks down, overpowering chipmaker Nvidia's consensus-beating quarterly results.

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