Infosys, Wipro lead India shares to record highs
MUMBAI (NewsRise) -- Indian shares rose to a record, helped by software exporters Wipro and Infosys, as weaker-than-expected U.S. inflation data tempered expectations of a quick monetary tightening in the world's largest economy, spurring demand for regional assets.
The benchmark BSE Sensex gained 0.2%, or 54.03 points, to 32,074.78 points. The broader NSE gained 0.3%, or 29.60 points, to 9,915.95 points. India's third-largest software exporter Wipro rose 3.1%, leading gains on the Sensex, after saying it will consider a share buyback proposal on July 20. Larger rival Infosys added 1.4% after first-quarter earnings last week prompted stock price target upgrades from CIMB and Morgan Stanley. Reliance Industries, due to report earnings on Thursday, rose 1.3%.
Most other Asian markets edged higher after the Dow Jones Industrial Average and the S&P 500 Index closed at record highs on Friday following soft U.S. inflation and retail sales data that pushed back bets of Federal Reserve rate increases. China's better-than-expected gross domestic product data for the second quarter also supported sentiment. The Nikkei Asia300 Index gained 0.2%.
"The market breadth is expected to see some correction in a month or so. However, quarterly earnings will set the tone going ahead," said Aditya Podar, vice president, investment banking at Pioneer Investcorp.
Twenty-one of the 30 Sensex constituents ended higher on Monday, while overall declining issues beat advancing ones 1,378 to 1,306 while 171 remained unchanged.
Tata Consultancy Services, which lost nearly 2% on Friday after a drop in first-quarter profit, was little changed. Nomura cut TCS's price target to 2,180 rupees from 2,200 rupees and retained its "reduce" rating on the stock, citing soft growth and weak margins.
State Bank of India gained 0.4% to 292.80 rupees. Its unit SBI Life Insurance Co. on Monday filed for an initial public offering of up to 120 million shares with the capital markets regulator. JM Financial Institutional Securities, Axis Capital, Citigroup Global Markets India and ICICI Securities are among the lead book running managers for the offering.
Sport-utility vehicle maker Mahindra & Mahindra added 0.4% to 1,383.30 rupees. The company is set to open its auto manufacturing unit in Detroit this fiscal year, reported The Economic Times, citing the group chairman.
Cigarette maker ITC lost 3.4%. The company's shares, which surged soon after India adopted the Goods and Services Tax starting July 1, have given up some gains in recent sessions.
India's GST council is meeting Monday to take stock of the implementation of the new tax regime and most traders expect the council to have a fresh look at cigarette taxes.
Hindustan Unilever was up 1.2% ahead of its earnings on Tuesday.
Jubilant FoodWorks, which operates Domino's Pizza and Dunkin Donuts chains in India, surged 9.3% after reporting a 26% jump in June-quarter profit. Deutsche Bank rated the company a "buy" with a price target of 1,250 rupees ahead of its earnings, calling it the top pick among consumer discretionary companies.
Oil & Natural Gas Corp. rose 1%. The company is in talks to merge or take over state-owned oil marketing company Hindustan Petroleum.
Dr. Reddy's Laboratories ended down 0.4%. S&P Global Ratings said it believes "Indian pharma companies may feel some pain as they adjust their quality ethos,invest to grow the business,and support the governments' vision of providing inexpensive healthcare."
Bajaj Finance and private lender ICICI Bank hit a 52-week high intraday ahead of earnings. Bajaj Finance ended up 2.6% to 1,538.70 rupees and ICICI Bank rose 1.7%.
--Dhanya Ann Thoppil