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India equities rise for second week on easing crude, better-than-expected earnings

Reliance Industries, Asian Paints among top gainers

MUMBAI (NewsRise) -- Indian shares posted gains for the second straight week as retreating crude oil prices and better-than-expected corporate earnings lifted investors' risk appetite.

The 30-stock BSE Sensex advanced 0.4%, while the broader Nifty 50 index rose 0.3% for the week. On Friday, the indexes declined 0.2% and 0.1%, respectively, to 35,158.55 and 10,585.20, weighed by weaker regional equities.

Energy-to-telecom conglomerate Reliance Industries gained 1.8% and Asian Paints rose 4.2% to be among the top gainers for the week.

The Brent crude price fell below the $70 per barrel mark -- the lowest in seven months -- on Friday after about 2% drop in the previous session. The U.S. benchmark oil was last trading below $60 per barrel. Since closing at a multiyear high of $86.29 and $76.40 on Oct. 3, respectively, the Brent crude price has now fallen more than 18% and the U.S. oil lost about 20.5%. The fall of the U.S. benchmark into bear market, defined as a 20% correction from the highs, has come amid rising concerns over global economic growth outlook and U.S. President Donald Trump's decision to grant temporary waivers to countries buying oil from Iran.

With India importing more than 80% of its crude oil requirements, any pullback in Brent prices benefits the economy, easing the nation's oil import bill.

Despite a truncated week due to the Diwali holidays, local stocks outperformed the region, helped by better-than-expected corporate earnings from most large companies, falling crude prices, and supportive trade in overseas markets. India's financial markets were closed on Thursday, while it was open on Wednesday for a special 60 minutes trading session as a mark to ring in the Hindu New Year.

Market participants await release of macroeconomic data next week, with October consumer price inflation data due on Monday.

Among other key index movers for the week, Tata Motors advanced 2.8%, after data from a U.K. auto trade body showed sharp increase in Jaguar registrations in October. The Mumbai-based automaker owns the Jaguar Land Rover luxury brands.

Two-wheeler makers Bajaj Auto and Hero MotoCorp climbed 1.5% and 2%, respectively, on bets festive season demand would boost sales volume this month.

Drug maker Cipla fell 13.4%, its biggest weekly decline in a decade. The company earlier this week reported an 11% decline in September-quarter net profit and warned of several headwinds in the second half of this fiscal year.

On Friday, shares of fuel retailers outperformed thanks to falling crude oil prices. Hindustan Petroleum gained 4.7%, Indian Oil rose 1.9%, and Bharat Petroleum ended 2.6% higher.

Bharti Airtel fell 2.5%. Rating agency Moody's Investors Service on Thursday placed the mobile phone operator's credit rating on review for downgrade citing low levels of profitability and expectations of weak cash flow.

State-run Indian Bank slumped 12.5% after a 67% fall in second-quarter net profit.

Hindustan Aeronautics surged 16.4% after its September quarter net profit rose more than fourfold on-year.

Hydroelectric power producer NHPC ended 5% higher after saying its board of directors will meet on Nov. 14 to consider a share buyback proposal.

Elsewhere in the region, the Shanghai Composite fell 1.4%, the Hang Seng Index declined 2.4%, South Korea's benchmark Kospi shed 0.3%, and Singapore's benchmark STI ended 0.5% lower after the dollar index jumped 0.8% overnight and the yield on 10-year U.S. Treasury notes climbed. The Fed reiterated its outlook for further gradual rate increases even as it stood pat on rates at its monetary policy review. The central bank is widely expected to increase rates for a fourth time this year at its December meeting.

--Gurdev Singh Virk

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