India’s Sensex Rises as Consumer Stocks Lead Advance
The S&P BSE Sensex fluctuated as it headed toward its first month of losses since May.
(Bloomberg) -- India’s benchmark equity index closed higher, after fluctuating between gains and losses for most part of the session, as investors turned their focus on the festive season ahead for signs of revival in consumer demand.
The S&P BSE Sensex rose 0.3% to 38,067.93 in Mumbai, after falling as much as 0.4% earlier in the day. While down 1.5% for the month, the gauge completed a second consecutive quarter of advance. The NSE Nifty 50 Index rose 0.2% today.
The indexes may show gains through to the end of the year, with history showing a five-year average 2.1% advance in the Sensex in the final three months when India’s festive season spending kicks in.
“There is some normalization of consumer demand with power consumption picking up, more customer inquiries for new vehicles,” said Anita Gandhi, an investment advisor at Arihant Capital Markets Ltd. in Mumbai. “Businesses are focusing on being cost efficient and going online which should help.”
The period from mid-October through December is the busiest time for purchases of products from gold ornaments to cars and apartments. A gradual relaxation of restrictions to curb the spread of coronavirus may help revive spending as the economy heads for its deepest recorded contraction.
In the fixed income market, sovereign bond traders are awaiting a borrowing plan for the second half of the financial year. The yield on 10-year government bonds fell 2 basis points to 6.02% while the rupee strengthened 0.1% to 73.7637 per U.S. dollar.
The Numbers
- Ten of 19 sector indexes compiled by BSE Ltd. rose, led by gauge of consumer companies; Crompton Greaves Consumer Electricals Ltd. climbed to a record high and was the best performer on S&P BSE Consumer Durable Index
- HDFC Bank Ltd. contributed the most to the Sensex advance, increasing 1.6% while Tech Mahindra Ltd. had the largest gain, rising 3.1%
- Reliance Industries Ltd. was the biggest drag on the index, declining 0.5% while Bharti Airtel Ltd. had the biggest drop, falling 3.3%
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