- Crude set for longest rally since April on U.S. stockpiles
- Sensex posts longest stretch of advances since late June
India’s benchmark stock index climbed to a six-week high as energy companies and metal producers gained amid advances in Asian equities and crude oil prices.
Vedanta Ltd., the largest copper producer, climbed the most in a month, while Hindalco Industries Ltd., the second-biggest aluminum maker, rallied the most in two years. Tata Steel Ltd., the biggest producer of the alloy, advanced for a third day. Oil & Natural Gas Corp. capped its longest stretch of gains in 18 months after saying exploration costs may decline 20 percent this fiscal year. Reliance Industries Ltd., owner of the world’s largest refining complex, completed the biggest six-day advance in more than three months.
The S&P BSE Sensex gained 0.4 percent to 27,035.85 at the close in Mumbai Wednesday, the longest stretch of advances since June 23. Global stocks have gained in the days after their worst quarter since 2011 amid speculation that weak economic data will convince the Federal Reserve to hold off on raising interest rates while anemic global growth puts pressure on central banks elsewhere to boost stimulus. Foreigners bought a net $123 million of Indian stocks on Monday in a third day of purchases, taking the year’s inflow to $3.7 billion, the most among eight Asian markets tracked by Bloomberg.
“Most of the correction in the Indian market last month was because of the global issues and a large part of that is done," Sampath Reddy, chief investment officer at Bajaj Allianz Life Insurance Co., which manages $6.8 billion, said in an interview with Bloomberg TV India Wednesday. “The stimulus provided by the RBI last week will percolate down to the capital expenditure spending and that will be the key driver of the markets."
The Sensex tumbled 5. 9 percent in the three months ended September, the worst quarter in four years. Even so, the gauge has risen 4.9 percent since Sept. 29 when the Reserve Bank of India cut its interest rate by more than economists’ had forecast. Governor Raghuram Rajan had left the repurchase rate unchanged in August, resisting government pressure to lower one of Asia’s highest borrowing costs as consumer prices slow.
Hindalco surged 9.2 percent, the most since August 2013. Vedanta rallied 5.9 percent, paring this year’s loss to 58 percent. Tata Steel gained 4.1 percent to its highest level since Sept. 14.
Oil & Natural Gas rose 4.2 percent in a sixth day of advance, the longest stretch since March 2014. GAIL India Ltd., the largest natural-gas supplier, climbed to its highest level since Aug. 20. Oil India Ltd. increased 2.4 percent, paring this year’s loss to 21 percent. Reliance Industries added 1.8 percent, a sixth day of advance.
Tata Motors Ltd., owner of Jaguar Land Rover, added 2.3 percent, extending this week’s advance to 15 percent. Motorcycle maker Bajaj Auto Ltd. increased 3.2 percent.
Indian Hotels Co. jumped 3.2 percent, with volumes 19 times the three-month daily average and the highest level in at least five years.
The Sensex has fallen 1.7 percent this year and trades at 15.7 times projected 12-month earnings, compared with the MSCI Emerging Markets Index’s multiple of 11.3. Earnings reporting season for the quarter ended September begins on Oct. 12, when Infosys Ltd. announces results.