July 24 (Bloomberg) -- Indian stocks climbed for an eighth day as gains by metalmakers and consumer goods companies helped lead the benchmark index to a record.
Tata Steel Ltd. rose for the first time this week, while aluminum producer Hindalco Industries Ltd. climbed the most on the S&P BSE Sensex amid data that showed Chinese manufacturing topped analyst estimates. Hindustan Unilever Ltd. and ITC Ltd., which have a combined 11 percent weighting on the index, rose for a fourth day.
The Sensex advanced 0.5 percent to 26,271.85, erasing an intraday loss of 0.3 percent to post its longest winning streak since September 2012. Foreigners have bought $12 billion of domestic shares this year, the most in Asia, on speculation that new Prime Minister Narendra Modi’s government will spur economic growth from near a decade low.
“The market is being driven by foreign flows, and sentiment is positive,” Mehraboon Irani, head of private client group at Nirmal Bang Securities Ltd., said by phone.
Tata Steel climbed 2.4 percent to its highest price since June 9, while Hindalco gained 2.2 percent. Steel Authority of India Ltd. surged 3.5 percent, the most since July 1.
A preliminary Purchasing Managers’ Index for China, the biggest consumer of industrial metals, rose to 52, exceeding the 51 median estimate of analysts in a Bloomberg survey, according to a report by Markit and HSBC Holdings Plc.
“The data contributed to gains in metal stocks here,” Irani said.
Hindustan Unilever added 1.4 percent, while ITC gained 0.8 percent. Software exporter Wipro Ltd. rose 1 percent to 576.85 rupees. The company said after market hours its fiscal first-quarter profit rose 30 percent to 21 billion rupees ($349 million), compared with the 21.3 billion rupees estimated by analysts.
Five of the eight Sensex companies that have posted results so far for the June quarter have beaten or matched forecasts.
The Sensex has rallied 24 percent this year and trades at 15.6 times projected 12-month earnings, compared with the MSCI Emerging Markets Index’s multiple of 11.2. The Indian gauge’s valuation climbed to 16.2 on July 7, the highest since April 2011. Shares won’t increase much more in the near-term, Mark Mobius, executive chairman of Templeton Emerging Markets Group, said in an interview today.
“There will be another opportunity to go in because after the euphoria you will see the market correcting,” Mobius, who oversees more than $40 billion, told Bloomberg TV.
Foreigners bought a net $139.5 million of local shares yesterday, a sixth straight day of net purchases, according to data compiled by Bloomberg.
“Stock prices have risen ahead of earnings, but if the money keeps coming in then the market will keep going up,” Nirmal Bang’s Irani said.
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