Indian Shares Rise On Fed Optimism, WPI Data

(RTTNews) - Indian shares rose notably on Thursday, with the benchmark index Sensex crossing the 26,000 mark and the Nifty approaching 7,800 level, after official data showed India's WPI inflation hit a five-month low in July.

India's wholesale price index slowed to 5.19 percent in July from 5.43 percent in the previous month, helped mainly by a moderation in fuel costs. Economists had forecast an inflation figure of 5.10 percent. The government has revised WPI May inflation upwards to 6.18 percent from 6.01 percent estimated earlier.

Coming close on the heels of Tuesday's disappointing consumer inflation numbers, the data reinforced the view that the Reserve Bank of India will keep interest rates high for a while.

Data showing strong FII buying on Wednesday, easing geopolitical concerns and speculation that the U.S. Federal Reserve won't rush to raise interest rates also buoyed investor sentiment ahead of a holiday tomorrow on account of Independence Day. Prime Minister Narendra Modi will deliver his Independence Day speech from the ramparts of the historic Red Fort in Delhi tomorrow.

The benchmark S&P BSE Sensex climbed 184.28 points or 0.71 percent to 26,103.23, with consumer durable, metal, banking, capital goods and realty stocks pacing the gainers. The broader CNX Nifty index closed at 7,791.70, up 52.15 points or 0.67 percent from its previous close.

Metal stocks Sesa Sterlite, SAIL, Jindal Steel and JSW Steel jumped 3-9 percent on speculation China will take steps to bolster growth. Trading giant MMTC rallied 3 percent after reporting an eight-fold jump in Q1 net profit. National Aluminium shares climbed 3.3 percent. The state-owned firm reported a whopping 70 percent jump in quarterly profit, beating estimates.

Tata Steel rose 1.2 percent, erasing early losses. The company disappointed investors by reporting a bigger-than-expected 70 percent drop in its first quarterly consolidated net profit, impacted by exceptional charges due to impairment of non-current assets.

State-run oil explorer ONGC gained 2 percent as it reported a 19 percent increase in first-quarter profit despite higher exploration related write-offs. Cipla also rose 2 percent ahead of its quarterly results due later in the day. Voltas rallied 8.4 percent after its Q1 earnings beat analyst estimates.

Whirlpool of India shares jumped 10 percent. The consumer durables firm reported a 67 percent increase in its standalone net profit for the first quarter ended June 30. GMR Infrastructure advanced 2.6 percent on fund raising reports.

BHEL, Sun Pharma, ICICI Bank, Larsen & Toubro, Tata Power, Tata Motors and Gail India rose 2-4 percent. FMCG firm Dabur India rose over 3 percent to hit a record high, while Hero MotoCorp shares fell 2.7 percent after Morgan Stanley Capital International rebalanced its MSCI India index.

Hindalco Industries dropped 0.8 percent as it reported a 30 percent decline in quarterly profit due to higher raw material and finance costs. Eicher Motors tumbled 3.8 percent on profit taking, snapping a three-session winning streak.

IT stocks such as Infosys, TCS, Infosys and Wipro ended largely unchanged as the rupee ticked higher in the wake of a weaker-than-expected report on U.S. retail sales. Zensar Technologies, the software services outsourcing arm of the RPG Group, shed half a percent after acquiring an e-commerce company for an undisclosed amount.

On the global front, the Asian markets ended mixed, with Chinese and Hong Kong shares giving back some ground after recent sharp gains, while the Japanese market extended gains into a fourth session to hit a one-week high, riding on the back of a weaker yen amid hopes that conflicts in Ukraine and the Middle East can be contained.

European stocks drifted lower as disappointing growth figures from France and Germany damped hopes of a quick recovery in the currency block.