Indian shares reverse losses

Indian shares rebounded to end 1.2 percent higher on Monday as investors grabbed shares offering value following last week's plunge over worries about the health of the global economy. Energy major Reliance Industries and top private-sector lender ICICI BANK led the gains, rising 3.3 percent to 757 rupees and 2.3 percent to 851 rupees, respectively.
Construction conglomerate Jaiprakash Associates jumped 5.38 percent. The 30-share main BSE index, which is down 20.3 percent this year, dropped 5 percent last week, extending its losses to 14 percent in four straight weeks, its longest weekly losing streak since Lehman Brothers' collapse in September 2008.
"The markets have taken a lot of pain in the past weeks and what we are seeing in the second half is just some bargain-hunting," said Sanjeev Patkar, director of research at brokerage Almondz Global. "The question is whether this kind of a bounce back will sustain. There is a lot of uncertainty in the global markets and so, if for the next 15-45 days there is no bad news globally, then we can hope it will sustain." World stocks held above a recent 11-month low on Monday while European shares bounced back up as hopes of an end of conflict in Libya pushed energy shares higher and a recent sharp sell-off encouraged investors back into the market.
However, worries that the sovereign debt crisis in eurozone peripheral countries may spread to bigger regional economies kept investor sentiment under check, keeping up the safe-haven flows into gold. The benchmark BSE index ended 1.24 percent up at 16,341.7 points, with 24 of its components closing in the green. The 50-share NSE index closed up 1.1 percent at 4,898.8 points. In the broader market, there were 2.5 gainers for every loser, with 537.3 million shares changing hands.
Finance Minister Pranab Mukherjee said last Friday that Indian stock markets had been affected by the US market sentiments but the country's economy was robust and that its growth story was intact. "These comments have been discounted," said Neeraj Dewan, director with brokerage Quantum Securities. "The prospects on the domestic macro front are not too bright either."
Private economists expect India's economic growth to slow down to less than 8 percent from 8.5 percent earlier in the current financial year to end-March 2012. Shares of India's No 2 software exporter Infosys and those of bigger rival Tata Consultancy Services both ended 1 percent lower on worries about a drop in demand in a weak global economy. Shares of automobile firms such as Tata Motors and Bajaj Auto rose 3.3 percent and 3.6 percent respectively on bargain-hunting.