India's Stocks Rise For Tenth Week; ICICI, Banks Lead Gains
May 15 (Bloomberg) -- India's stocks rose for the 10th week, the longest winning streak in almost three years, as the ruling party said it was confident of retaining power without support from the Communists after voting in general elections closed.
ICICI Bank Ltd., the country's second-largest lender, jumped 7.2 percent, leading gains among financial stocks after the central bank said it was seeking to restore economic growth. State Bank of India increased 3.6 percent, while HDFC Bank Ltd., the third-biggest, added 1.8 percent.
"The fundamentals of the economy are strong, and domestic institutions are waiting on the sidelines with funds," said Manish Sonthalia, who helps oversee the equivalent of $100 million of equities at Motilal Oswal Securities Ltd. in Mumbai. "The election is the only glitch, but the market seems to have discounted that."
The Bombay Stock Exchange's Sensitive Index, or Sensex, rose 300.51, or 2.5 percent, to 12,173.42 at the close in Mumbai. The measure increased 2.6 percent in the past five days, completing its 10 weeks of gains, the longest stretch since the period ending Sept. 29, 2006.
The S&P CNX Nifty Index on the National Stock Exchange added 2.2 percent to 3,671.65. The BSE 200 Index gained 2.1 percent to 1,437.53. SGX Nifty futures for May delivery advanced 2 percent to 3,685.
The Sensex's gain today reversed a 2.3 percent drop in the past two days amid concerns that the ruling Indian National Congress party would need to tie up with the Communists to form the next government. Trade Minister Kamal Nath said in an interview in New Delhi yesterday his ruling party would be able to form the next government without that alliance.
ICICI, HDFC
The Communists, who want to limit foreign investment and almost brought down the government last year over a nuclear energy deal with the U.S., are expected to win fewer seats, according to an NDTV 24x7 exit poll. The results of the five- week long election will be released tomorrow.
ICICI Bank gained 7.2 percent to 574.70 rupees. HDFC Bank rose 1.8 percent to 1,184.95 rupees. State Bank added 3.6 percent to 1,313.50, a one-week high.
Reliance Industries Ltd., India's biggest company by market value, increased 2.2 percent to 1,950.70 rupees. Larsen & Toubro Ltd., the nation's largest engineering company, rose 4.5 percent to 989 rupees, the most since May 4.
The Reserve Bank of India will seek to unwind monetary measures taken since September after the global financial crisis ends. The central bank has reduced its policy rate six times since mid-October to a record low, predicting Asia's third- biggest economy will expand at the slowest pace in seven years.
It also lowered the amount of money lenders need to keep as reserves, while the government cut tax rates and boosted spending, pumping cash equivalent to $85 billion into the banking system to arrest a slide in growth.
"Once the crisis is behind us, managing inflationary expectations and unwinding of the current expansionary policy will be our task and our challenge," Governor Duvvuri Subbarao said in the southern city of Bangalore yesterday.
To contact the reporter on this story: Rajhkumar K Shaaw in Mumbai at rshaaw@bloomberg.net
May 15 (Bloomberg) -- India's stocks rose for the 10th week, the longest winning streak in almost three years, as the ruling party said it was confident of retaining power without support from the Communists after voting in general elections closed.
ICICI Bank Ltd., the country's second-largest lender, jumped 7.2 percent, leading gains among financial stocks after the central bank said it was seeking to restore economic growth. State Bank of India increased 3.6 percent, while HDFC Bank Ltd., the third-biggest, added 1.8 percent.
"The fundamentals of the economy are strong, and domestic institutions are waiting on the sidelines with funds," said Manish Sonthalia, who helps oversee the equivalent of $100 million of equities at Motilal Oswal Securities Ltd. in Mumbai. "The election is the only glitch, but the market seems to have discounted that."
The Bombay Stock Exchange's Sensitive Index, or Sensex, rose 300.51, or 2.5 percent, to 12,173.42 at the close in Mumbai. The measure increased 2.6 percent in the past five days, completing its 10 weeks of gains, the longest stretch since the period ending Sept. 29, 2006.
The S&P CNX Nifty Index on the National Stock Exchange added 2.2 percent to 3,671.65. The BSE 200 Index gained 2.1 percent to 1,437.53. SGX Nifty futures for May delivery advanced 2 percent to 3,685.
The Sensex's gain today reversed a 2.3 percent drop in the past two days amid concerns that the ruling Indian National Congress party would need to tie up with the Communists to form the next government. Trade Minister Kamal Nath said in an interview in New Delhi yesterday his ruling party would be able to form the next government without that alliance.
ICICI, HDFC
The Communists, who want to limit foreign investment and almost brought down the government last year over a nuclear energy deal with the U.S., are expected to win fewer seats, according to an NDTV 24x7 exit poll. The results of the five- week long election will be released tomorrow.
ICICI Bank gained 7.2 percent to 574.70 rupees. HDFC Bank rose 1.8 percent to 1,184.95 rupees. State Bank added 3.6 percent to 1,313.50, a one-week high.
Reliance Industries Ltd., India's biggest company by market value, increased 2.2 percent to 1,950.70 rupees. Larsen & Toubro Ltd., the nation's largest engineering company, rose 4.5 percent to 989 rupees, the most since May 4.
The Reserve Bank of India will seek to unwind monetary measures taken since September after the global financial crisis ends. The central bank has reduced its policy rate six times since mid-October to a record low, predicting Asia's third- biggest economy will expand at the slowest pace in seven years.
It also lowered the amount of money lenders need to keep as reserves, while the government cut tax rates and boosted spending, pumping cash equivalent to $85 billion into the banking system to arrest a slide in growth.
"Once the crisis is behind us, managing inflationary expectations and unwinding of the current expansionary policy will be our task and our challenge," Governor Duvvuri Subbarao said in the southern city of Bangalore yesterday.
To contact the reporter on this story: Rajhkumar K Shaaw in Mumbai at rshaaw@bloomberg.net
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