India's stocks rise most in a week on IMF growth outlook
Friday, 9 July 2010
MUMBAI, July 8 (Bloomberg): Indian stocks climbed the most in than a week after the International Monetary Fund raised the growth outlook for the South Asian nation.
Tata Steel Ltd led a rally in raw material producers after the nation's steel consumption increased in June. India's gross domestic product may expand 9.4 per cent this year, the IMF said today, raising its 8.8 per cent estimate in April. ICICI Bank Ltd, the country's second-biggest lender, rose to the highest in more than a week.
"The affirmation by an outside agency obviously is a positive for sentiment," said Ajay Argal, who helps manage about $13.5 billion in assets at Birla Sun Life Asset Management Co in Mumbai. "The industrial production, GDP numbers have been strong."
The Bombay Stock Exchange's Sensitive Index, or Sensex, gained 180.7, or 1 per cent, to 17,651.73, the biggest advance since June 28. The S&P CNX Nifty Index on the National Stock Exchange rose 1.1 per cent to 5,296.85. The BSE 200 Index increased 1 per cent to 2,248.74.
Argal expects earnings of Sensex companies to climb more than 20 per cent in the year ending March. That would be the fastest pace in three years, according to data compiled by Bloomberg. He is bullish on shares of construction and capital goods companies, declining to name specific stocks.
India's $1.2 trillion economy expanded 8.6 per cent in the three months through March from a year earlier, the fastest pace after China and Brazil among major economies. Finance Minister Pranab Mukherjee said June 22 annual growth in Asia's third- largest economy may exceed 10 per cent in the next five years.
"The IMF report shows there is strong demand in the economy, it's a big positive for the equity markets," said Alex Mathews, head of research at Geojit BNP Paribas Financial Services Ltd in Kochi, southern India. "This will lead to higher production and improved earnings." Mathews recommended shares of automakers and lenders, including Mahindra & Mahindra Ltd., Maruti Suzuki India Ltd and Axis Bank Ltd.
ICICI Bank increased 1.9 per cent to 862.3 rupees. Maruti, the maker of half the cars sold in the country, increased 1.7 per cent to 1,403.4 rupees. India's passenger car sales may grow at 12 per cent to 13 per cent in the year ending March, while demand for trucks may gain by as much as 20 per cent, according to Society of Indian Automobile Manufacturers.
Tata Steel Ltd led a rally in raw material producers after the nation's steel consumption increased in June. India's gross domestic product may expand 9.4 per cent this year, the IMF said today, raising its 8.8 per cent estimate in April. ICICI Bank Ltd, the country's second-biggest lender, rose to the highest in more than a week.
"The affirmation by an outside agency obviously is a positive for sentiment," said Ajay Argal, who helps manage about $13.5 billion in assets at Birla Sun Life Asset Management Co in Mumbai. "The industrial production, GDP numbers have been strong."
The Bombay Stock Exchange's Sensitive Index, or Sensex, gained 180.7, or 1 per cent, to 17,651.73, the biggest advance since June 28. The S&P CNX Nifty Index on the National Stock Exchange rose 1.1 per cent to 5,296.85. The BSE 200 Index increased 1 per cent to 2,248.74.
Argal expects earnings of Sensex companies to climb more than 20 per cent in the year ending March. That would be the fastest pace in three years, according to data compiled by Bloomberg. He is bullish on shares of construction and capital goods companies, declining to name specific stocks.
India's $1.2 trillion economy expanded 8.6 per cent in the three months through March from a year earlier, the fastest pace after China and Brazil among major economies. Finance Minister Pranab Mukherjee said June 22 annual growth in Asia's third- largest economy may exceed 10 per cent in the next five years.
"The IMF report shows there is strong demand in the economy, it's a big positive for the equity markets," said Alex Mathews, head of research at Geojit BNP Paribas Financial Services Ltd in Kochi, southern India. "This will lead to higher production and improved earnings." Mathews recommended shares of automakers and lenders, including Mahindra & Mahindra Ltd., Maruti Suzuki India Ltd and Axis Bank Ltd.
ICICI Bank increased 1.9 per cent to 862.3 rupees. Maruti, the maker of half the cars sold in the country, increased 1.7 per cent to 1,403.4 rupees. India's passenger car sales may grow at 12 per cent to 13 per cent in the year ending March, while demand for trucks may gain by as much as 20 per cent, according to Society of Indian Automobile Manufacturers.