Mumbai: Indian shares climbed 0.7% on Friday led by financials as investors awaited an official forecast on the annual monsoon, while energy major Reliance Industries rose ahead of its quarterly result.
Outsourcer Wipro initially rallied more than 3% after its earnings met market expectations and the company recommended two bonus shares for every three, but then pared the gains.
“Earnings are to a large extent factored into the market, though company specific-events and results might drive intra-day movements,” said Mahesh Patil, fund manager at Birla Sun Life Asset Management.
By 11:26am, the 30-share BSE index was trading up 0.73% at 17,701.85 points, with 21 components gaining. The 50-share NSE Index was up 0.7% at 5,307.15 points.
Bank stocks were among the top gainers in the index on hopes of a pick-up in loan demand on a rebounding economy and strong monsoon expectations. Private lender ICICI Bank rose 1.7% to 960.30 rupees.
Larger rival State Bank was up 1.4% at Rs2,253.30 while HDFC Bank gained 0.7% to Rs1,949.55.
The weather department is scheduled to announce at 4pm, its forecast for the annual monsoon, which is crucial for the country’s farm output and inflation outlook.
“There has been a huge build-up of positions based on an expected good monsoon,” Arun Kejriwal, strategist at research firm KRIS said.
Last year, the worst rains in 37 years had hit farm output and sent food prices soaring in the world’s most populous nation.
Reliance Industries, which has the heaviest weight in the main index, was up 1.1% at Rs1,087.30. The energy giant is expected to report after market hours a second straight rise in quarterly profit, with growth helped by higher gas output.
Wipro, India’s No. 3 outsourcer, pared gains to 0.1% at Rs703.90 after rising to Rs728. Shares its larger rivals Tata Consultancy were up 0.5% and Infosys rose 0.9%.
In the broader market, gainers led losers 824 to 468 on moderate volume of 254.5 million shares.
Patil said the outlook for the market in the near term would be driven more by global events that could determine funds flows from overseas investors.
“If the risk appetite changes that will obviously have an impact on our markets as our market is driven by foreign funds flows,” he said.
Foreign funds have invested a net $1.1 billion in Indian equities this month, data from the regulator’s website showed.
On Thursday, global markets were spooked by speculation that debt-laden Greece would default on its sovereign debt, which led to the euro tumbling and losses in European stocks though Wall Street recouped losses in late-day trades to end positive on strong quarterly earnings from consumer firms.