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India shares post weekly gains, powered by upbeat earnings, HDFC Bank's jum

Mahindra, Coal India top performers on Sensex

MUMBAI (NewsRise) -- Indian shares outperformed other regional indexes this week on the back of upbeat earnings by key companies. Heavyweight HDFC Bank's biggest jump in 15 months also aided the advance.

The BSE Sensex and the Nifty 50 Index advanced 0.9% each this week, despite a pullback in Friday. Mahindra & Mahindra and Coal India were the top performers on the Sensex this week, up 5.2% and 6.6%, since last Friday. Mahindra's March quarter earnings topped expectations, helped by better-than-expected gross margins and cost reduction initiatives. In Coal India's case, while its earnings missed analysts' forecast on account of a jump in employee costs, robust realizations and revenue growth were a bright spot.

HDFC Bank advanced 4.9% this week as the lender's stocks opened up for purchases by foreign institutional investors with India's market regulator closing the window that allowed FII's to buy the shares from other foreigners.

Sun Pharmaceutical Industries posted a weekly advance of 3.5% after the company was upgraded by CLSA following a 7% rise in March quarter net profit. Larsen & Toubro has advanced 2% since last Friday after reporting a better-than-expected 4.7% gain in March quarter net profit.

On Friday, Coal India edged 0.1% lower, HDFC Bank fell 1.3%, Sun Pharmaceuticals advanced 0.6%, and Larsen gained 0.3%. Mahindra fell 2.4% after its May sales increased 12% on-year, slower than the 22% growth witnessed in April.

Sageraj Bariya, vice president of institutional sales at East India Securities, said with Indian markets having undergone a decent price and time correction in recent months, the next leg of uptrend is likely to emerge. Among sectors, he is positive on consumption, technology, and metals.

The performance of Indian markets this week was in contrast to most other Asian markets, which declined amid renewed worries of a global trade war and political impasse in Italy.

Earlier this week, just days ahead of the U.S. Commerce Secretary's trip to China, the White House said it will impose tariffs on $50 billion of Chinese imports. Further on Thursday, the U.S. said it will impose tariffs on steel and aluminum imports on its allies who were earlier provided a temporary exemption on the levy. In response to Washington's move, Canada, Mexico, and the European Union threatened tariffs of their own.

On Friday, the Sensex declined 0.3% to 35,227.26 and the Nifty 50 Index dropped 0.4% to 10,696.20. State Bank of India was the biggest contributor to the losses, ending 0.9% lower.

Earlier in the day, the Sensex had climbed to a more-than-two-week high after data released after markets closed on Thursday showed India's economy accelerated at its fastest pace in seven quarters. The GDP grew 7.7% in the March quarter, higher than the 7.3% reading expected by economist polled by Reuters.

Among other movers on Friday, Bajaj Auto jumped 5.1% after the two-wheeler maker's May sales jumped 30% on-year. Maruti Suzuki India added 3% after saying it sold 172,512 units last month, up 26% from a year ago. Ashok Leyland added 1.7% after the commercial vehicle maker sold 13,659 units in May, up 51% from a year earlier. Tata Motors advanced 1.5% after selling 54,295 units last month, an increase of 58% from a year ago.

ICICI Bank closed 1.4% higher, recovering from Thursday's losses that came after the board ordered an enquiry against the bank's CEO Chanda Kochhar. The lender on Friday denied a report by Mint newspaper that Kochhar had been asked to go on indefinite leave pending the enquiry.

Oil & Natural Gas dropped 2.5% after a report by Press Trust of India that the crude explorer may have to bear fuel subsides, amid attempts by the government to control rising retail petrol and diesel prices.

--Nimesh Vora

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