In­dia in­vestors bank on eco­nomic re­cov­ery

The Punch - - BANKING PERSONAL -

IN­DIAN stocks rose on the ex­pec­ta­tion that a slow­down in eco­nomic ex­pan­sion has bot­tomed out and growth will re­cover in 2020 on the back of Fi­nance Min­is­ter, Nir­mala Sithara­man’s planned $1.5tn in­fra­struc­ture push.

The S&P BSE Sen­sex climbed 0.1 per cent to 41,306.6 at the 3.30 pm close in Mumbai. The NSE Nifty 50 In­dex also ad­vanced by 0.1 per cent, Bloomberg re­ported on Wed­nes­day.

Stocks had largely priced in a slow­down that had seen the coun­try’s econ­omy grow­ing at the slow­est pace since 2013. Fo­cus was shift­ing to whether a rally in the bench­mark in­dexes would broaden out to the wider mar­ket, and which in­dus­tries were most likely to ben­e­fit from a po­ten­tial re­vival in Gross Do­mes­tic Prod­uct growth in In­dia as well as glob­ally.

“In­for­ma­tion tech­nol­ogy and bank stocks were some of the best ways to play the eco­nomic re­cov­ery,” said Prakash Pandey, who over­sees in­vest­ments and re­search at Plu­tus Ad­vi­sors & con­sult­ing Ltd in New Delhi.

“In IT, there is not much of a debt problem, com­pared to other sec­tors. Growth in busi­ness will go straight to the bot­tom line. Midcap banks also have a lot of po­ten­tial to gain this year, partly by cap­i­tal­is­ing on non-bank lenders’ strug­gles.”

Ten of 19 sec­tor sub-in­dexes com­piled by BSE Ltd gained, led by a gauge of power com­pa­nies

Half of the Sen­sex’s 30 shares rose.

HDFC con­tributed the most to the in­dex ad­vance, in­creas­ing 0.8 per cent, while Power Grid had the largest gain, climb­ing 2.8 per cent.

In­dusind Bank was the big­gest drag on the in­dex, de­clin­ing 1.7 per cent, Ti­tan co. had the big­gest drop, fall­ing 2.8 per cent.

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