India shares gain as Fed keeps outlook unchanged; Nifty rises to record
MUMBAI (NewsRise) -- Indian shares rose Thursday, with the Nifty 50 index hitting a record high, as stocks across the Asian region gained after the U.S. Federal Reserve maintained its outlook for interest rate increases for the year, boosting investors' risk appetite.
The benchmark BSE Sensex rose 0.6%, or 187.74 points, to 29,585.85, a more-than-two-year high and just shy of 29,681.77, the record level hit on Jan. 29, 2015. The broader NSE Nifty 50 index gained 0.8%, or 68.90 points, to 9,153.70, its highest ever.
The U.S. central bank on Wednesday raised interest rates by quarter of a percentage as expected, while maintaining the outlook for two more increases this year and three in 2018. The Fed said it would be tolerant of "some inflation overshooting."
The dovish tone of the statement sent risk assets across the region higher. Hong Kong's Hang Seng index closed at a 19-month high and China's Shanghai Composite index gained 0.9%. South Korea's Kospi index ended 0.8% higher.
"Though the record peaks have kept investors nervous, the prospect of a gradual U.S rate increase looks to have improved the risk appetite," said Anand James, chief market strategist at Geojit Financial Services. "Going ahead, save a negative surprise from monsoon forecast, the January-March corporate earnings due next month should prompt investors to be forward looking."
On the Sensex, 24 of the 30 constituents ended higher, while overall advancing issues beat declining ones 1,802 to 1,039 and 171 closed unchanged.
Blue chip shares led the market gains on sustained interest from foreign funds, traders said. Mortgage lender Housing Development Finance Corp. rose 1.5% to 1,449.70 rupees and software exporter Infosys finished 1.6% higher at 1,028.50 rupees.
Larsen & Toubro advanced 1.4% to 1,568.30 rupees, aided by 47% on-year jump in India's engineering goods demand in February.
Tata Steel gained 4.3% to 499.15 rupees after media reports said China plans to reduce excess sub-standard steel capacity by 100 million tones. Shares also benefitted from reports that the company's talks for the merger of its U.K. business with German conglomerate Thyssenkrupp are in final stages.
State Bank of India rose 0.6% to 278.95 rupees. Late Wednesday, the state-run lender said its board has approved a plan to raise up to $2.3 billion through equity in the fiscal year that starts Apr. 1.
HCL Technologies ended up 1.8% at 855.35 rupees. The company's board will consider a proposal for a share buyback on Mar. 20.
Indian Oil Corp rose 1.8% to 376 rupees after the nation's Cabinet Committee of Economic Affairs approved a 24% stake sale in Lubrizol India to its joint venture partner Lubrizol Corp.
Bharti Airtel declined 0.8% to 360.25 rupees after India's largest mobile phone company said it has dropped a plan to sell a controlling stake in its mobile tower unit.
--Dhanya Ann Thoppil