Indian Stocks Gain as Bank Stocks Rise; central bank interest rate hikes in focus

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A man looks at a screen displaying budget information, on a facade of the Bombay Stock Exchange (ESB) building in Mumbai, India, February 1, 2022. REUTERS/Francis Mascarenhas

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BENGALURU, Sept 19 (Reuters) – Indian stocks edged higher in volatile trade on Monday, helped by gains in bank stocks, as investors awaited a series of central bank meetings this week to gauge the impact of the rises rates on the global economy.

The NSE Nifty 50 Index (.NSEI) rose 0.7% to 17,649 at 0455 GMT and the S&P BSE Sensex (.BSESN) rose 0.6% to 59,208. Both indices lost more than 1.5% last week.

Investors have braced themselves for a week littered with 13 central bank meetings that will certainly see borrowing costs rise across the globe and some risk of a major hike in the United States.

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“The broad market is focused on the statement from the US Federal Reserve this week, even though it has already discounted a 75 basis point rate hike,” said Prashanth Tapse, research analyst at Mehta Equities.

Markets will be looking at the Fed’s forecast for November, when another 75 basis point hike is expected, Tapse said.

Although Indian markets lost almost 2% last week, foreign investors bought $819 million net worth of Indian stocks, despite selling $258 million net in the last two trading sessions , according to Refinitiv Eikon.

The data showed the tally for the month at the last close was $1.52 billion in net inflows.

Rate-sensitive bank stocks were the main gainers, with the Nifty Banks Index (.NSEBANK) rising 0.76%, while the Public Sector Banks Index (.NIFTYPSU) jumped 2%.

Among individual stocks, Ambuja Cement (ABUJ.NS) and ACC (ACC.NS) rose 6.7% and 1.6%, respectively, after Adani Enterprises (ADEL.NS) completed its acquisition of companies and reconstituted their boards of directors.

Shares of Mahindra and Mahindra (MAHM.NS) gained 2.5% after Canadian pension fund Ontario Teachers’ Pension Plan agreed to buy a 30% stake for 23.71 billion Indian rupees ($297. $5 million) in the Indian automaker’s renewable energy assets. Read more

Meanwhile, shares of Oil & Natural Gas Corp rose 1.5% after India cut taxes on domestic crude oil on Friday. Read more

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Reporting by Nallur Sethuraman and Gaurav Dogra in Bengaluru; Editing by Dhanya Ann Thoppil and Savio D’Souza

Our standards: The Thomson Reuters Trust Principles.

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