Indian Stocks Jump to Six-Month High As Greece Nears Agreement
Indian stocks rose to a six-month high, erasing losses, as Greece’s leaders neared an agreement on further spending cuts needed to receive a rescue package.
HDFC Bank Ltd. (HDFCB), the second-biggest private lender, climbed to a record. Infosys Ltd. (INFO), which gets more than a fifth of its revenue from Europe, gained to near a one-month high. Sterlite Industries (India) Ltd. rallied to a three-month high, the most among 30 companies on the benchmark BSE India Sensitive Index. (SENSEX)
The Sensex gained 0.7 percent to 17,830.75 at 3:30 p.m. close in Mumbai, its highest level since Aug. 3. The measure erased an intraday loss of 0.6 percent. The S&P CNX Nifty (NIFTY) Index on the National Stock Exchange of India Ltd. jumped 0.8 percent to 5,412.35. The BSE 200 Index rose 0.9 percent.
Greek Prime Minister Lucas Papademos and the leaders of the three parties supporting the government “agreed on all the points of the program with the exception of one which requires further elaboration and discussion” with lenders, according to an e-mailed statement from the premier’s office. They failed to resolve a dispute over pension cuts. The Stoxx Europe 600 Index advanced 0.5 percent as investors speculated that Greece will accept the spending cuts needed to obtain further aid.
Foreign funds have invested a net $3.6 billion in Indian stocks this year, compared with an outflow of $512 million in 2011, data from the regulator show. The flows have fueled the 14 percent rally in the Sensex, helping the gauge recoup more than half its 2011 losses. The measure trades at 15.6 times future earnings, compared with 19.4 times at end of 2010. The MSCI Emerging Markets Index trades at 10.5 times.
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