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Asia300

India shares record best weekly gain in 8 months on company earnings

MUMBAI (NewsRise)--Indian shares recorded their best weekly gains in eight months after rising Friday, as better-than-expected company earnings and expectations the government will unveil steps to boost economic growth at its annual budget next week lifted demand.

Supportive global markets and short-covering on expiry of the monthly derivatives contracts in the previous session also helped stocks post gains during the week, dealers said.

The benchmark BSE Sensex index rose 0.6% to 27,882.46 points on Friday, its highest level since Oct. 28, while the broader NSE Nifty 50 index closed 0.5% higher at 8,641.25 points. For the week, the indices gained 3.1% and 3.5%. Financial stocks led the markets higher through the week as HDFC Bank and Kotak Mahindra Bank reported better-than-expected October-December earnings.

"The market continued to reach newer highs as the Budget Day nears. Investors are making sure not to miss the rally and a good set of quarterly numbers is also adding fresh impetus," said Vinod Nair, Head of Research at Geojit BNP Paribas Financial Services. "The return of foreign inflows is a positive factor to brace the turnaround."

Foreign investors purchased a net $181.07 million worth of shares in the previous session on Wednesday, the biggest single day of purchases since September end.

Investors are hoping the government will unveil several measures at its federal budget on Feb. 1, especially after New Delhi's demonetization move in November damped economic activity in the world's second-most populous nation. Brokerages expect some reduction in taxes, increase in spending on infrastructure and some incentives for the rural economy.

Twenty of the 30 Sensex constituents finished higher on Friday, while overall declining stocks edged past advancing ones 1,411 to 1,376, with 209 issues ending unchanged.

The BSE Bankex index was the top sectoral gainer for week, ending up 4.8% at 22,566.24 points. HDFC Bank, India's biggest lender by market value, gained 0.4% to 1,293 rupees, taking weekly gains to 4.6% after several brokerages upgraded their price target. The bank posted a 15% rise in quarterly profit. Kotak Mahindra Bank rose 8.6% for the week, despite ending down 1.2% on Friday. The lender posted a 39% jump in quarterly profit.

Mortgage lender Housing Development Finance Corporation was the top Sensex gainer, ending up 2.6% at 1,370.70 rupees. For the week, the shares jumped 10.8%, their biggest weekly gains since 2009. Traders expect the company to report strong quarterly earnings on Jan. 30.

Maruti Suzuki India gained 4.4% to 5,921.50 rupees for the week after the car maker posted a 48% jump in October-December net income to 17.45 billion rupees as sales of higher priced car models increased. Friday, shares rose 2.2%.

Software exporter Wipro declined 1.6% to 466.10 rupees, taking weekly losses to 2.3% after the company forecast a modest 1% to 2.1% sequential revenue growth for the current quarter.

Cigarette maker ITC fell 2.8% to 257.50 rupees, after reporting a 6% on-year increase in net profit to 2.65 billion rupees. Cigarette segment revenue grew a modest 2.2% to 82.88 billion rupees.

Elsewhere in the region on Friday, Hong Kong's Hang Seng fell 0.1% while China's Shanghai Composite rose 0.3%. Japan's Nikkei 225 index ended 0.3% higher and South Korea's Kospi index added 0.8%

--Dhanya Ann Thoppil

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