Indian shares hit record peaks as ONGC soars on higher oil prices

BENGALURU: Indian shares scaled record peaks on Friday and were set for a sixth straight weekly gain as Oil and Natural Gas Corp surged on the back of higher crude prices, with sentiment also supported by optimism over COVID-19 vaccines.

The NSE Nifty 50 index rose 0.66pc to 13,567.05 by 0511 GMT, while the benchmark S&P BSE Sensex was up 0.66pc at 46,261.33. Both the indexes were set to finish the week more than 2pc higher.

ONGC, which has lost nearly a third of its market value this year, climbed 10pc after Brent rose above $50 for the first time since March, as coronavirus vaccination rollouts kept hopes alive that demand for crude would build up next year.

Oil-to-retail conglomerate Reliance Industries gained 1.5pc.

"Indications that demand is coming back and of a likely improvement in refining margins may now drive the beaten-down oil and gas sector to lead gains going forward," said Rusmik Oza, head of fundamental research at Kotak Securities in Mumbai.

"India is somewhat standing out among emerging markets because of the way the economy has bounced back even with meagre stimulus, showing that demand has normalised in the system."

Sentiment was also underpinned by data showing a steady decline in new coronavirus cases in India - the country with the second-highest caseload - where daily infections have dipped after hitting a peak in September.

The Nifty Auto Index gained 0.6pc after data from an industry body showed passenger vehicle sales rose nearly 5pc in November, boosted by festive demand.

Broader Asian shares were also higher after a panel of outside advisers to the U.S. health regulator overwhelmingly endorsed the emergency use of Pfizer Inc's coronavirus vaccine, with investors also watching U.S. fiscal stimulus talks and Brexit negotiations.