India\\\'s NSE index rises to record close

FE Team | Published: May 23, 2014 00:00:00 | Updated: November 30, 2026 06:01:00

MUMBAI, May 22 (Reuters): India's NSE index closed at a record high on Thursday, recovering from falls in the prior session as investors resumed buying stocks of companies expected to benefit from an economic recovery, and as Coal India Ltd (CIL) surged on expectations it would be broken up.
Jewellery makers such as Titan Co Ltd surged after the Reserve Bank of India (RBI) allowed banks to provide gold loans to jewellery makers, while also expanding the number of private agencies that can import the precious metal.
The broader sentiment got a leg-up after Reuters reported that India's finance ministry was working on a proposal for the new government to cut welfare spending and rein in fiscal deficit to 3.8-3.9 per cent of GDP, in its first budget.
Global factors were also supportive, with Asian equities rising to a year high after an upbeat reading in a private survey on China's factory sector and the US Federal Reserve's signal it would not raise interest rates anytime soon.
Despite concerns about the pace of recent gains, Indian shares continue to be supported by hopes that the new government led by incoming Prime Minister Narendra Modi would fulfil its promise of reviving economic growth.
"We are very encouraged with the strong mandate. We continue to have an overweight position in India. Now it is time for the Modi government to deliver on their promise and execute," said Christopher Wong, a Singapore-based fund manager at Aberdeen Asset Management Plc, which oversees over 300 billion pounds worldwide.
The broader NSE index rose 0.32 per cent, or 23.50 points, to close at 7,276.40.
The benchmark BSE index rose 0.31 per cent, or 76.38 points, to end at 24,374.40.
Both the indexes resumed their rising streak after a breather on Wednesday.
Hopes of a revival in the domestic economy continued to bolster sectors such as banks and utilities.
ICICI Bank ended higher 0.8 per cent, marking a cumulative gain of 32 per cent for 2014 so far, while power utility NTPC Ltd rose 5.9 per cent.
Coal India, the world's biggest coal miner, surged 5.1 per cent after Reuters reported that the Modi government was exploring breaking up the company and opening up the sector.
Among jewellery companies, Titan shares ended 6.8 per cent higher after earlier surging as much as 13.7 per cent, while Gitanjali Gems Ltd gained 11.9 per cent.
Maruti Suzuki India Ltd surged 4.4 per cent after CLSA said the stock price could double in three years in a bull scenario in which the personal vehicle industry volume grows at a compounded annual growth rate of 20 per cent due to pent-up demand should the economy pick up.