Indian shares logged their first weekly gain in three weeks, rising 2.9 percent on Friday, with support from global markets that displayed some relief after Greece reached an agreement for an austerity plan to avoid a debt default. Financials led the rise with State Bank of India, ICICI Bank and HDFC Bank rising between 2.1 and 5.7 percent. The Bank Index gained 3.1 percent on the day.
Greece won the consent of international lenders on Thursday for a five-year austerity plan intended to avoid looming bankruptcy and its prime minister pledged to push radical economic reforms through parliament. The benchmark 30-share BSE index ended the day 513.19 points higher at 18,240.68, with all but two of its components closing in the positive zone.
"The market is responding to overseas cues and positive developments on commodity inflation which is easing. There is definitely an expectation of moderation in oil prices," said K.K. Mital, head of portfolio management services at Globe Capital. Foreign funds have been dumping Indian stocks recently, on worries over rising inflation and a slowdown in economic growth in the world's second-fastest growing major economy after China. They have sold a net $628 million of shares in a total of eight sessions to June 21.
State-run oil marketing companies Indian Oil, Bharat Petroleum and Hindustan Petroleum , which would benefit from any increase in fuel prices, were up between 2.46 percent and 6.14 percent. The 50-share NSE index closed up 2.84 percent at 5,471.25 points. The index is down 11 percent year-to-date, and is the worst performer among major Asian markets. By comparison, MSCI's measure of Asian shares other than Japan is down 1.8 percent so far in 2011.
The Sensex is headed for its second annual decline in a decade as persistently high inflation, rising interest rates and slowing growth keep investors at bay, a Reuters poll showed. In the broader market, 1,162 gainers outnumbered 278 losers on a volume of 648 million shares.
Comments
Comments are closed for this article.