Most Indian stocks rose after the International Monetary Fund boosted its forecast for the global economy and a Spanish bond sale eased concerns the debt crisis may be worsening in Europe, India’s biggest trading partner.
Tata Motors Ltd. (TTMT), which owns Jaguar Land Rover, extended gains from a record. HDFC Bank Ltd. (HDFCB) climbed to its highest-ever price after fourth-quarter earnings jumped 30 percent. Wipro Ltd. (WPRO), the third-biggest software maker, rose for the third day. The BSE India Sensitive Index (SENSEX), or Sensex, added 0.1 percent to 17,378.94, according to preliminary closing prices.
The IMF increased its outlook for global growth in 2012 to 3.5 percent from 3.3 percent, while Spain sold 12-month and 18- month bills a day after yields on its 10-year bonds reached the highest level this year. The Reserve Bank of India cut its benchmark rate for the first time in three years yesterday to revive growth. The Sensex pared intraday gains of as much as 1 percent after Governor Duvvuri Subbarao reiterated that he sees limited scope for further reductions.
“The markets need follow-up action from the government in terms of policy initiatives,” PVK Mohan, head of equities at Principal PNB Asset Management Co. in Mumbai, said yesterday in an interview.
The RBI cut the repurchase rate by 0.5 percentage points to 8 percent, more than the 25 basis-point median estimate of 25 economists in a Bloomberg survey. India’s economy expanded at the slowest pace in three years in the fourth quarter after the RBI raised rates a record 13 times between March 2010 and October last year and a political gridlock deterred investment.
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