Indian stocks advance on speculation US recession has ended
Thursday, 17 September 2009
MUMBAI, Sept. 16 (Bloomberg): India's benchmark stock index rose for the second day after US Federal Reserve Chairman Ben S. Bernanke said the worst US recession since the 1930s has probably ended, raising optimism for a return to global growth.
Tata Steel Ltd., the nation's largest maker of the alloy, rose 6.1 per cent, leading gains on speculation that economic recovery will boost demand for its products in Asia's third- biggest economy. State Bank of India Ltd., the No. 1 lender, added 2.2 per cent to an 18-month high after the central bank signaled it will refrain from raising borrowing costs.
"Sentiment on the street has been positive; Bernanke's comments are a confirmation of the same," said Mohit Mirchandani, head of equity investment at Taurus Mutual Fund in Mumbai, who helps manage $127 million in assets.
The Bombay Stock Exchange's Sensitive Index, or Sensex, rose 121.55, or 0.7 per cent, to 16,576 at 1:10 p.m. in Mumbai, its highest since May 23, 2008. The S&P CNX Nifty Index on the National Stock Exchange gained 0.8 per cent to 4,931.90. The BSE 200 Index advanced 0.8 per cent to 2,033.19.
The US recession is likely to have ended, Bernanke said yesterday at the Brookings Institution in Washington, while warning that growth may not be strong enough to quickly reduce the unemployment rate.
The Reserve Bank of India wants to keep borrowing costs at a record low to spur investment and spending amid a drought that threatens to reduce farm output. The $1.2 trillion economy expanded 6.1 per cent in the three months to June from a year earlier, accelerating for the first time since 2007, as the Reserve Bank of India cut its benchmark interest rate six times from October 2008 through April.
Tata Steel rose 6.1 per cent to 522.35 rupees, its highest in a year. State Bank of India gained 2.2 per cent to 2,052 rupees, the highest in more than 18 months.
Sterlite Industries (India) Ltd., the nation's biggest copper producer, advanced 2.7 per cent to 765 rupees after metal prices rose as sales at US retailers jumped by the most in three years in August, led by a surge in auto buying.
Three-month delivery copper rose as much as 1.2 per cent to $6,280 a metric ton on the London Metal Exchange and traded at $6,260 a ton. December-delivery copper in New York added as much as 0.7 per cent to $2.8645 a pound, while the December-delivery contract on the Shanghai Futures Exchange climbed as much as 1.5 per cent to 49,090 yuan ($7,189) a ton.
LIC Housing Finance Ltd., the mortgage lender, controlled by India's biggest life insurer, jumped to a record after it raised $135 million selling shares to institutional investors.
LIC Housing, the second-best performer on the 67-stock Bloomberg Asia Pacific Diverse Financial Services Index, jumped 7.2 per cent to 722 rupees. The Mumbai-based company sold 10 million shares at 658 rupees apiece, according to a sale document.
Overseas funds bought a net 2.62 billion rupees ($54 million) of Indian stocks on Sept. 14, the Securities and Exchange Board of India said yesterday on its Web site. The funds have bought a net 429.5 billion rupees of the nation's stocks this year to date, compared with record net sales of 530 billion rupees for the whole of 2008.
Tata Steel Ltd., the nation's largest maker of the alloy, rose 6.1 per cent, leading gains on speculation that economic recovery will boost demand for its products in Asia's third- biggest economy. State Bank of India Ltd., the No. 1 lender, added 2.2 per cent to an 18-month high after the central bank signaled it will refrain from raising borrowing costs.
"Sentiment on the street has been positive; Bernanke's comments are a confirmation of the same," said Mohit Mirchandani, head of equity investment at Taurus Mutual Fund in Mumbai, who helps manage $127 million in assets.
The Bombay Stock Exchange's Sensitive Index, or Sensex, rose 121.55, or 0.7 per cent, to 16,576 at 1:10 p.m. in Mumbai, its highest since May 23, 2008. The S&P CNX Nifty Index on the National Stock Exchange gained 0.8 per cent to 4,931.90. The BSE 200 Index advanced 0.8 per cent to 2,033.19.
The US recession is likely to have ended, Bernanke said yesterday at the Brookings Institution in Washington, while warning that growth may not be strong enough to quickly reduce the unemployment rate.
The Reserve Bank of India wants to keep borrowing costs at a record low to spur investment and spending amid a drought that threatens to reduce farm output. The $1.2 trillion economy expanded 6.1 per cent in the three months to June from a year earlier, accelerating for the first time since 2007, as the Reserve Bank of India cut its benchmark interest rate six times from October 2008 through April.
Tata Steel rose 6.1 per cent to 522.35 rupees, its highest in a year. State Bank of India gained 2.2 per cent to 2,052 rupees, the highest in more than 18 months.
Sterlite Industries (India) Ltd., the nation's biggest copper producer, advanced 2.7 per cent to 765 rupees after metal prices rose as sales at US retailers jumped by the most in three years in August, led by a surge in auto buying.
Three-month delivery copper rose as much as 1.2 per cent to $6,280 a metric ton on the London Metal Exchange and traded at $6,260 a ton. December-delivery copper in New York added as much as 0.7 per cent to $2.8645 a pound, while the December-delivery contract on the Shanghai Futures Exchange climbed as much as 1.5 per cent to 49,090 yuan ($7,189) a ton.
LIC Housing Finance Ltd., the mortgage lender, controlled by India's biggest life insurer, jumped to a record after it raised $135 million selling shares to institutional investors.
LIC Housing, the second-best performer on the 67-stock Bloomberg Asia Pacific Diverse Financial Services Index, jumped 7.2 per cent to 722 rupees. The Mumbai-based company sold 10 million shares at 658 rupees apiece, according to a sale document.
Overseas funds bought a net 2.62 billion rupees ($54 million) of Indian stocks on Sept. 14, the Securities and Exchange Board of India said yesterday on its Web site. The funds have bought a net 429.5 billion rupees of the nation's stocks this year to date, compared with record net sales of 530 billion rupees for the whole of 2008.