Reuters
India’s benchmark BSE index posted yesterday its biggest daily gain since June 6, rising for a second straight session, helped by news that Tata Motors had tripled its quarterly net profit.
The broader NSE index’s fall of 3.5% since its record high on July 25 until last week was also starting to look overdone, according to some analysts, given continued expectations for an improving domestic economy.
Investors will now keenly await data on India’s June industrial production and July consumer prices due after the close of markets for a better indication of the health of the economy.
“The selling pressure has got absorbed and the correction was mostly overdone. I think the overall outlook remains positive, but one should stay stock-specific,” said Suresh Parmar, head, institutional equities at KJMC Capital Markets. The benchmark BSE index rose 1.42% to close at 25,880.77, while the NSE index added 1.33% to end at 7,727.05.
Among the top gainers, Tata Motors surged 6.2%, marking its biggest daily percentage gain since Sept. 10, 2013, when its luxury unit Jaguar Land Rover (JLR) unveiled a $2.4bn investment in a new range of cars aimed at the mass market.
On Monday, Tata Motors said April-June net profit more than tripled on the back of strong sales from JLR.
Others gained on earnings optimism. Sun Pharmaceutical Industries gained 2.7% ahead of its quarterly results later in the day.
Tata Steel closed up 1.4% ahead of earnings today.
Eicher Motors gained 8.2% after April-June quarter earnings beat analyst estimates.
Also getting a lift were Housing Development Finance Corp, which surged 5%, while HDFC Bank rose 1.8% on speculation the two may see their weightages increase in a rebalancing of global indexes by index provider MSCI, due by mid-month.
Rupee edges up
The rupee rose slightly yesterday as gains in local shares improved sentiment even as global currency markets continued to see-saw because of conflicting signs coming from geo-political flashpoints such as eastern Ukraine.
While the week started with sentiment weighed in favour of emerging market currencies due to hopes for easing political tensions, reports yesterday of a Russian aid convoy heading to Ukraine yet again increased concerns.
That kept sentiment cautious, although the rupee was able to gain some ground against the dollar after the benchmark BSE index rose 1.4% to post its biggest daily gain since June 6 on optimism around corporate earnings.
Traders also awaited industrial output and consumer inflation data due later in the day for a better check on the domestic economy. Unnati Parekh, head of currency derivatives at Kanji Forex, an institutional forex brokerage in Mumbai, said it was best for importers to buy dollars now.
The partially convertible rupee closed at 61.08/09 per dollar, compared with Monday’s close of 61.19/120. The unit has been rebounding after dropping to 61.74 last week, its lowest since March 5.
