BackShares hit 32-month high; SBI, HDFC Bank at record
Shares hit 32-month high; SBI, HDFC Bank at record
Premium
Mumbai: Indian shares extended gains to 2% on Monday afternoon, riding on better-than-expected jump in factory output and firm world equities.
At 2:06pm, the 30-share BSE index was up 2.03% at 19,180.72 points. The 50-share NSE index was up 2.05% at 5,755.70.
Markets raced to their highest level in 32 months, boosted by robust July factory output data and firm Asian markets.
Financials led the gains, with State Bank of India, the country’s largest lender, and HDFC Bank hitting all-time high as investors bet demand for loans would rise on the back of an expanding economy.
On Friday when the market was closed, data showed industrial output accelerated 13.8% in July on surging capital goods production, strengthening the case for monetary tightening by the central bank to tame near double-digit inflation.
By 11:27 a.m., the 30-share BSE index was trading up 1.67% at 19,112.19, with 28 of its components gaining. It rose to 19,116.92, its highest since January 2008. The 50-share NSE index was up 1.6% at 5,732.40 points.
“The IIP data was the strongest trigger. I am not sure if the market can hold up. Advance tax figures around 15 September should provide more cues," said R K Gupta, managing director of Taurus Mutual Fund.
The benchmark index has gained 9.4% so far this year, adding to the spectacular 81% jump in 2009. “It looks like a liquidity-driven rally and the market is reaching dangerous levels," Gupta said.
Data from Nomura showed foreign funds pumped $502 million into Indian equities last week, and were the next preferred investment bet after Japan and Korea in the region.
Asian shares rose on encouraging economic data out of China and the United States, and as a deal on global bank rules gave lenders some respite before having to raise hundreds of billions of dollars in fresh capital.
State Bank of India was up 4.3% at ₹ ,111.05, after hitting a record ₹ ,128.75. HDFC Bank rose as high as ₹ 2,270 before coming off to 2,265, up 1.1%. ICICI Bank breached a 31-month-high and was trading up 3.5%.
Global regulators agreed a set of radical new capital rules for banks on Sunday that could free up stronger lenders to release surplus cash while forcing some laggards to raise funds.
State-run explorer Oil & Natural Gas Corp was up 1.7% after the oil secretary told reporters on Saturday the company would make a joint bid with Petrovietnam for BP’s Vietnam assets after completing evaluation in the next few weeks.
Outsourcers gained on hopes for improving economic outlook in United States, dealers said. Top outsourcer Tata Consultancy Services climbed 0.9%, while rival Infosys Technologies firmed 1.1%.
In the broader market, gainers were double the number of losers on volume of 183 million shares..
The broader MSCI’s measure of Asian markets other than Japan was up 1.7%, while Japan’s Nikkei rose 0.9%.
STOCKS
Kale Consultants was up 13.4% at Rs161.85 after the company said the founders agreed to sell 35.6% stake to Accelya Holding World at a price of 172 per share.
Omaxe Ltd gained 2.1% to Rs137 as its unit got contract worth Rs128 crore.
Unlock a world of Benefits! From insightful newsletters to real-time stock tracking, breaking news and a personalized newsfeed – it's all here, just a click away! Login Now!
