Indian shares closed higher for a third straight session on Tuesday, led by HDFC Bank and Reliance Industries due to cheaper valuations after the benchmarks slipped into correction territory recently.
The NSE Nifty 50 rose 0.75% to 24,457.15 points, while the BSE Sensex added 0.74% to 80,845.75. This is their longest gaining streak since September.
The Nifty 50 is now 6.9% below its all-time high levels hit in late September. Both benchmarks fell into correction territory last month.
“In the current markets after the correction, there is lesser froth across market cap segments, which has brought back investors,” said Kranthi Bathini, director of equity strategy at WealthMills Securities.
Reliance Industries, which has gained 3% in the previous two sessions, added 1.1% on the day.
High-weightage financials rose about 1%, led by a 1.2% climb in HDFC Bank.
Axis Bank rose 2.1%, while ICICI Bank added 0.3%.
Reliance leads rise in Indian shares; growth slowdown factored in
“Financials offer valuation comfort and investors could choose to keep their money in the segment till December quarter earnings season plays out,” Bathini said.
Public sector banks climbed 2.6%, with Bank of Baroda gaining 3.5% and Union Bank rising 5.3%.
BofA Securities, which noted that Indian state-owned banks had attractive valuations, reiterated “buy” on Bank of Baroda and Union Bank.
It also identified Axis Bank and ICICI Bank as its top private sector bets.
Eleven of the 13 sectoral indexes logged gains. The more domestically focused smallcaps and midcaps added about 0.9% each.
Consumer index shed 0.4%, dragged by cigarette maker ITC and Pepsi bottler Varun Beverages which fell 1% and 1.8%, respectively.
Media reports said the government plans to hike the goods nd services tax (GST) on products such as aerated beverages, cigarettes and other tobacco-related items to 35% from the current 28%.
Adani Ports rose 6%, after Bernstein reiterated “outperform”. The stock trades cheaper than its peers JSW Infra and Container Corp, the brokerage said.
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