Nine of the 13 sector gauges compiled by the Mumbai Stock Exchange fell, led by the S&P BSE India Metal Index. The S&P BSE India Realty Index rose 8.8%, to its highest level last seen in August 2014.
Indiabulls Real Estate was the top performing realty stock, surging over 40%, the most since at least 2007, after the company said it will consider separating its commercial and residential assets and raise funds selling stakes in the units.
The rally sent developers higher on speculation rivals will emulate the move, which simplifies the business structure. “Most large global investors have preferred to participate in the commercial, leasing market in India as the retail space has been going through a very sluggish phase with tepid demand,” Abhishek Lodhiya, an analyst at Mumbai-based Angel Broking, said in an email. Markets are expecting “value discovery for Indiabulls Real Estate through this move.”
Indian stocks marked their biggest three-month gain in three years in the quarter ended March, fuelled by optimism that Prime Minister Narendra Modi’s government will be able to push through key economic reforms and bolster corporate profits. While the nation’s GDP expanded 7% or more in each of the last four quarters, Sensex profits fell in two of those periods amid a tepid investment climate and rising bad loans.
“The market is now keenly waiting for earnings of companies like Tata Consultancy Services, IndusInd Bank and Yes Bank due this week,” said Purvesh Shelatkar, senior vice-president of institutional sales at Centrum Broking Ltd in Mumbai. “Barring the pharmaceutical and IT companies, which may show an impact of the sharp appreciation of the Indian rupee, we expect the financials to do well. The results may surprise us on the upside.”
Meanwhile the rupee yesterday closed marginally weaker against the US dollar after local equity markets fell six out of seven trading sessions. The rupee closed at 64.52 a dollar, down 0.16% from its Thursday’s close of 64.41.
The rupee opened at 64.43 a dollar and touched a high and a low of 64.29 and 64.52, respectively. The benchmark Sensex index fell 0.16% or 47.79 points to close at 29,413.66. So far this year, it has risen 12%. The wholesale price index-based inflation fell to 5.7% in March from 6.5% in February, mainly due to a fall in mineral and fuel prices, while food prices continued to rise.
The 10-year bond yield closed at 6.847% compared to its previous close of 6.822%. Bond yields and prices move in opposite directions. So far this year, the rupee has gained 5.5%, while foreign institutional investors have bought $6.62bn and $6.48bn from local equity and debt markets, respectively.
Asian currencies were trading higher after the holiday following a report that US inflation fell for the first time in more than a year. Thai baht was up 0.44%, Japanese yen 0.24%, South Korean won 0.18%, Singapore dollar 0.16%, China offshore 0.08%, Taiwan dollar 0.07%, Malaysian ringgit 0.06%.
However, Indonesian rupiah was down 0.09%, Philippines peso 0.07%. The dollar index, which measures the US currency’s strength against major currencies, was trading at 100.29, down 0.22% from its previous close of 100.51.