Indian Stocks Climb to Three-Week High as Foreigners Turn Buyers

  • Global funds buy shares for 3rd day, longest run since October
  • Metals, oil and gas shares rally led by Tata Steel, ONGC

Indian stocks climbed for a second day this week after data showed overseas investors added to their holdings of local shares and as U.S. consumer data lifted Asian equities.

GAIL India Ltd., the biggest natural-gas supplier, increased the most in a month. Oil & Natural Gas Corp. rose for a third day. Bharti Airtel Ltd., India’s largest cell-phone company, rallied to a three-week high. Tata Steel Ltd. climbed to its highest price in five months.

The S&P BSE Sensex jumped 1 percent to 25,850.30, its highest close since Dec. 3. Foreign funds bought a net $43 million of domestic stocks on Dec. 21 in a third day of purchases, the longest run of inflows since the end of October. The Sensex has fallen in December only twice in the past decade, the data compiled by Bloomberg show.

“India is a clear outlier in the emerging-markets basket,” Anil Ahuja, Singapore-based chief executive officer of IPEplus Advisors, said in an interview with Bloomberg TV India on Wednesday. “While the EM basket may have a problem due to a risk-off trade, India should see a positive momentum.”

U.S. Data

Stocks rose in Europe and Asia amid growing investor confidence in the U.S. and Chinese economies. U.S. shares climbed on Tuesday after data showed consumer spending buoyed the American economy in the third quarter, the latest evidence that growth is strong enough to weather tighter monetary policy from the Federal Reserve. In China, early economic indicators in December are showing more signs of stabilization as leaders of the world’s second-largest economy indicate they’ll do more to bolster the expansion.

GAIL India was the top performer on the Sensex, rising 5.8 percent. Oil & Natural Gas added 2.2 percent to the highest price since Dec. 2. Bharti Airtel jumped 2.8 percent, paring this year’s loss to 5.8 percent.

Tata Steel gained 2.7 percent, taking this month’s rally to 15 percent. Vedanta Ltd., the biggest copper producer, increased 3.8 percent. Hindalco Industries Ltd., an aluminum producer, jumped 5.4 percent to the highest since Oct. 30.

The Sensex has fallen 6 percent this year and trades at 15.5 times projected 12-month earnings. The MSCI Emerging Markets Index is valued at a multiple of 11.1.

Before it's here, it's on the Bloomberg Terminal. LEARN MORE