Indian shares rebound from virus-led slump; banks, metals jump

BENGALURU: Indian shares rebounded on Tuesday after a bruising coronavirus-led tumble in the previous session, as beaten-down financial stocks gained and metal stocks benefited from a jump in commodity prices.

A severe second wave of the novel coronavirus in India has threatened to disrupt the country's nascent economic recovery and dragged its main stock indexes from record highs hit in February.

Still, investors are looking ahead to corporate earnings that began on Monday with software services major TCS reporting a rise in March-quarter profit.

The NSE Nifty 50 index was up 0.55% at 14,388.15 by 0500 GMT, while the S&P BSE Sensex was 0.5% higher at 48,123.34.

Each index fell more than 3% on Monday, as the hardest-hit, economically important state of Maharashtra contemplated a lockdown.

India reported more than 160,000 new cases on Tuesday, although the figure was slightly lower from Monday. Maharashtra, home to financial hub Mumbai, also saw a downtick.

"The market is feeling that a lockdown might just be avoided, especially as cases are slightly slowing down in Maharashtra and Mumbai," said A.K. Prabhakar, head of research at IDBI Capital in Mumbai.

State-run banks gained 2.7% and were among the top sectoral gainers. The index had dropped 9% in the previous session.

Metal stocks advanced 2.8% after benchmark iron ore prices surged on falling supplies from major miners and strong demand.

Indian regulatory approval for Russia's Sputnik V COVID-19 vaccine sent shares in local partner Dr Reddy's Labs up as much as 3%, but it reversed course and was last down 3.6%. Its pharmaceutical peers, many of which sell COVID-19 medication, also fell after strong gains in the last few days.

IT services stocks fell 1.5%. Heavyweight TCS fell 3.6% as investors locked in gains from the stock's 10% jump this year.