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Equities

India shares eke out marginal gains as software exporters advance

Tata Consultancy, Infosys rise after rupee slumps to 15-month low

MUMBAI (NewsRise) -- Indian shares edged higher on Wednesday, as gains in software exporters triggered by the rupee's decline offset losses in fuel retailers.

The BSE Sensex rose 0.3% to 35,319.35 and Nifty 50 Index advanced 0.2% to 10,741.70. An index of information technology companies added 0.7%, as the Indian currency fell to a 15-month low. The rupee, hurt by overall dollar strength and rise in global crude oil prices, dropped to its lowest level since February last year. Tata Consultancy Services added 1.4%, HCL Technologies advanced 0.7%, and Infosys closed 0.5% higher.

Among major losers, Hindustan Petroleum and Bharat Petroleum fell up to 1.7%, as Brent crude climbed to new three-year highs on Wednesday following U.S. President Donald Trump's decision to pull out of the Iran nuclear deal. The move raises geopolitical risk premiums and also increases the possibility of crude prices continuing their ascent.

India is particularly vulnerable to rising oil prices as it imports more than two-third of its fuel requirements. For Indian fuel retailers, higher crude prices hurt margins.

IDBI Capital cut the target price on all the three fuel retailers as it cut the earning per share estimates for next financial year by up to 13%. It raised its crude oil price assumption to $64 per barrel for the next financial year from $55 earlier.

Energy explorers and service providers to the sector advanced. Hindustan Oil Exploration closed 6.3% higher while Aban Offshore added 3.1%.

The U.S. indexes ended little changed overnight and the Nikkei Asia300 Index of companies outside of Japan rose 0.1% on Wednesday. Investors' attention was on moves in the U.S. fixed income market where the 10-year yield was back to near 3% amid the jump in oil prices.

Among other movers, aluminum producer Hindalco Industries edged 0.1% lower. The stock had jumped 3.8% in early trade following upbeat earnings from its U.S. subsidiary. For the March quarter, Novelis reported a 38% increase in net income excluding special items. Hindalco's earnings are scheduled for next Wednesday.

Zee Entertainment Enterprises declined 0.4% and Asian Paints rose 1.7% ahead of their earnings due on Thursday.

Sintex Industries soared 8.3% after the water tank manufacturing company reported a 16% rise in net profit for the March quarter.

--Nimesh Vora

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