Related News:
Sensitive Index Advances Most in 10 Weeks; Maruti Climbs on Record Sales
India’s stocks climbed the most in 10 weeks, led by raw material producers as investors speculated economic expansion will boost profitability and demand.
Sterlite Industries (India) Ltd., the largest copper producer, gained as metal prices advanced and its rating was raised by Nomura Holdings Inc. India’s economy expanded at the fastest pace in 2 1/2 years last quarter, the government said yesterday. Maruti Suzuki India Ltd., the biggest carmaker, increased after reporting its highest ever monthly sales.
The Bombay Stock Exchange’s Sensitive Index, or Sensex, rose 234.75, or 1.3 percent, to 18,205.87, its biggest gain since June 21. The S&P CNX Nifty Index on the National Stock Exchange added 1.3 percent to 5,471.85. The BSE 200 Index increased 1.4 percent to 2,335.12.
“There is strong demand in the Indian economy and it’s likely to continue,” said D.K. Aggarwal, who manages about $100 million as chairman of SMC Wealth Management Services Ltd. in New Delhi. “The global growth concern has eased a bit.” Aggarwal said he’s increasing his investments in drugmakers, carmakers, infrastructure and fast-moving consumer goods companies, without naming any.
Expansion
Sterlite advanced 3.6 percent to 156.5 rupees, its steepest one-day climb since July 21. Gauges of raw-material and energy companies in the MSCI Asia Pacific Index climbed at least 2.5 percent, the most of 10 industry groups, on optimism commodities demand in China will increase. Sterlite’s rating was raised to “buy” from “neutral” by Prabhat Awasthi and Alok Kumar Nemani, analysts at Nomura, citing the view that recent declines in the stock price are overdone.
India’s economy expanded 8.8 percent in the three months through June from a year earlier, a government report showed yesterday. The MSCI Asia Pacific Index gained 1.5 percent today after China’s manufacturing expanded at a faster pace and Australia’s economy grew more than economists estimated, signaling any moderation in growth isn’t deepening.
Tata Steel Ltd., India’s biggest producer of the alloy, rose 2.9 percent to 537.95 rupees, its highest close since Aug. 9. Hindalco Industries Ltd., the largest aluminum producer, jumped 4.7 percent to 174.25 rupees.
Maruti advanced 1.2 percent to 1,272.75 rupees after its August sales rose 24 percent to 104,791 units. TVS Motor Co Ltd., the third-largest motorcycle maker, climbed 0.7 percent to 143.3 rupees after reporting August sales rose to a record.
Fund Flows
Adani Power Ltd., the generation arm of India’s biggest coal importer, climbed 1.7 percent to 138.2 rupees after saying it plans to spend about 825 billion rupees ($17.5 billion) to increase capacity almost 17-fold to 16,500 megawatts in the next four years.
Foreign fund inflows to India’s equities have climbed 54 percent this year, making the Sensex the most expensive benchmark index in Asia and among the BRIC markets that also comprise Brazil, Russia and China. The Sensex is trading at 17.4 times estimated profit after extending last year’s biggest rally in 18 years.
Overseas funds bought a net 2.73 billion rupees of Indian equities on Aug. 30, raising total investments in the stocks this year to 593.8 billion rupees, according to the nation’s market regulator.
Inflows from overseas reached a record 834.2 billion rupees in 2009, exceeding the high set two years ago in local currency terms, as the biggest advance in 18 years lured foreign funds. They sold a record 529.9 billion rupees of shares in 2008, triggering a record annual decline.
To contact the reporter on this story: Rajhkumar K Shaaw in Mumbai at rshaaw@bloomberg.net.
Rate These Stories
Rate this Page