India’s Sensex Climbs to Record in Diwali Trading as Autos Gain

Indian (SENSEX) stocks advanced, sending the benchmark index to a record in a shortened session. Automakers and metal producers led the gains.

Tata Motors Ltd. (TTMT), the owner of Jaguar Land Rover, rallied to its all-time high. Jindal Steel & Power Ltd. (JSP) climbed for the second day, sending a measure of metalmakers to an eight-month high. Indian Oil Corp. (IOCL) surged the most in two months, leading other state-owned refiners higher.

The 30-stock S&P BSE Sensex rose 0.2 percent to 21,239.36 in special Diwali trading in Mumbai, a fifth day of gains. The gauge has increased 9.3 percent this year, the most among the four largest emerging markets, as more companies posted profits that beat estimates and as monetary stimulus helped spur $2.9 billion of net foreign flows into shares last month.

“There been some pick-up in the economy and corporate performance has been ahead of expectations,” Raamdeo Agrawal, joint managing director of Mumbai-based Motilal Oswal Financial Services Ltd., said on Bloomberg TV India today. “The downside is limited and people who have stayed out of the market should start investing.”

Net incomes at 16 of the 19 companies in the Sensex that have posted results exceeded analyst estimates, according to data compiled by Bloomberg. About 47 percent of the 30 companies in the index missed forecasts in the previous quarter. Foreigners bought $290 million of local shares on Oct. 31, the biggest net inflow since Sept. 20, data from the regulator showed today.

Investors and traders made ceremonial purchases of stocks in the 75-minute session until 7:30 p.m., marking Diwali, the festival of lights and the start of the Hindu new year, Samvat 2070. The session known as Muhurat trading is held every year on Diwali and deemed the most auspicious time to start investments.

Sun, TCS

The Sensex has risen 14 percent since last Diwali on Nov. 11, 2012, boosted by purchases by overseas investors. Shares of 21 of the 30 Sensex firms have risen since last year’s Muhurat day, led by drugmaker Sun Pharmaceutical Industries Ltd. (SUNP) and Tata Consultancy Services Ltd. (TCS), India’s biggest software exporter. Power-equipment maker Bharat Heavy Electricals Ltd. and Jindal Steel Ltd. are the biggest losers over the period.

The Sensex traded at 14.1 times projected 12-month profits, in line with its five-year average. The MSCI Emerging Markets Index was valued at 10.5 times earnings. Overseas funds have invested $16.3 billion into domestic shares in 2013, the most among 10 Asian markets tracked by Bloomberg after Japan.

The CNX Nifty Index added 0.2 percent to 6,317.35. The India VIX, which gauges the cost of protection against losses in the Nifty, gained 4.6 percent.

Stock exchanges will remain closed tomorrow.

To contact the reporter on this story: Rajhkumar K Shaaw in Mumbai at rshaaw@bloomberg.net

To contact the editor responsible for this story: Michael Patterson at mpatterson10@bloomberg.net

Bloomberg reserves the right to edit or remove comments but is under no obligation to do so, or to explain individual moderation decisions.

Please enable JavaScript to view the comments powered by Disqus.