BackSensex caps its biggest weekly winning run in two years
Info Edge (India) led a rally among domestic e-commerce-related companies after Alibaba raised $21.8 billion
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Mumbai: Indian stocks advanced for a sixth week, the longest weekly run in more than two years, as shares related to e-commerce climbed following Alibaba Group Holding Ltd’s record initial public offering in the US.
Info Edge (India) Ltd led a rally among domestic e-commerce-related companies after Alibaba raised $21.8 billion. Maruti Suzuki India Ltd increased to a record. Jet Airways (India) Ltd climbed the most in a week after a local unit of Moody’s Investors Service, upgraded its rating. Tata Consultancy Services Ltd (TCS) paced gains among technology shares.
The S&P BSE Sensex fell less than 0.1% to 27,090.42 at the close on Friday. For the week, it added 0.1%. Alibaba and shareholders including Yahoo Inc. sold 320.1 million shares for $68 each, after offering them for $66 to $68, according to a statement. In India, Flipkart.com and Amazon.com Inc. in July said they would invest $1 billion and $2 billion each to tap a market CLSA Asia-Pacific Markets projects will grow sevenfold to $22 billion by 2018.
“There is no major listed e-commerce company in India, but the cheer from the Alibaba IPO is spreading to stocks related to the sector," Paras Bothra, vice president for equity research with Ashika Stock Broking Ltd in Mumbai, said by phone. “This bodes well for local e-commerce companies."
Info Edge, which runs an online job and matrimonial website, jumped 6.2%, the most since 9 September. Just Dial Ltd, which operates a local online search engine, advanced 1.3% after chief financial officer Ramkumar Krishnamachari said he expects e-commerce to add to sales from the fiscal year that begins 1 April 2015. Gati Ltd, a logistics company, surged 5%, taking this year’s gains to more than 300%.
China, Japan
Indian equity gauges advanced this week amid optimism over trade ties with China. The Sensex, which has risen 28% this year, its longest weekly stretch of increases since a seven-week rally through 19 February 2012.
Chinese President Xi Jinping on Thursday pledged to invest $20 billion in India over five years. Prime Minister Narendra Modi met Japanese Prime Minister Shinzo Abe in Tokyo earlier this month and visits the US later this month to meet President Barack Obama, looking to bolster ties. Abe offered 50 billion yen ($460 million) in infrastructure loans and pledged 3.5 trillion yen of investment and financing over five years.
“Modi has made economic diplomacy a tool to boost growth, and that’s very positive for the economy, company earnings and stock markets," Kishor Ostwal, managing director of equity research provider CNI Research Ltd, said by phone on Friday. “Now investors will look forward to Modi’s US visit to see how trade relations with the world’s biggest economy play out."
Jet, Cipla
Maruti added 1.3%, extending this year’s rally to 75%, the best performer on the Sensex this year. Drug maker Cipla Ltd and Housing Development Finance Corp. Ltd, the top mortgage lender, both rose 1.3%. Jet Airways surged 3%, paring this year’s loss to 21%.
TCS gained 2.7% to a record and the best performance on the Sensex on Friday. Wipro Ltd rose 1.1%, a third day of gains.
The Sensex is the best performer among the world’s 10 biggest markets this year as foreigners have bought $14.1 billion of shares, the most among the eight Asian markets tracked by Bloomberg. The gauge trades at 15.7 times projected 12-month earnings, compared with the MSCI Emerging Markets Index’s multiple of 11.2.
Ameya Karve contributed to this story.Bloomberg
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