By Chris Thomas
BENGALURU, July 1 – Indian stocks eked out modest gains as they entered the second half of the year, helped by heavyweight financials, although worries over the impact on the economy from a persistent surge in coronavirus cases tempered investor sentiment.
The NSE Nifty 50 index rose 0.3% to 10,332.9 by 0527 GMT on Wednesday, while the benchmark S&P BSE Sensex was up 0.4% at 35,055.94, after recording their best quarter in 11 years.
“Post the initial pick up in the market seen after the economy reopened, it is going to remain in a range as pent up demand looks set to run out,” said Neeraj Dewan, director at Quantum Securities in New Delhi.
“For now, global liquidity is helping the market … but all indications are that the economy will take longer than anticipated to recover.”
Prime Minister Narendra Modi on Tuesday warned citizens against flouting rules to prevent the spread of the virus, as he extended a scheme providing free food grains to 800 million Indians, at a cost of around $12 billion.
Coronavirus cases in India jumped by more than 18,000 to 585,493 as of Wednesday morning, including 17,400 deaths, according to federal health ministry data.
The stock market has recovered sharply from multi-year lows hit in mid-March on virus fears, but the benchmark indexes are still down around 15% for the year, having already suffered earlier in the year from a weak economy.
Meanwhile, broader Asian stocks struggled for traction as better-than-expected Chinese factory activity could not soothe worries that a surge in coronavirus cases in the United States could hinder an economic recovery.
In Mumbai on Wednesday, lenders HDFC Ltd and Axis Bank Ltd were among the top boosts to the Nifty, rising as much as 2.2% and 2.6%, respectively, while agro-chemical maker UPL Ltd was the top percentage gainer with a jump of 3.4%.
Telecom operator Bharti Airtel rose as much as 2.7% after Carlyle said it will buy a 25% stake in Bharti’s data centre arm for $235 million.
Oil and Natural Gas Corporation Ltd dropped 3.8% to its lowest since end-May after reporting a loss for the March quarter. ($1 = 75.5400 Indian rupees) (Reporting by Chris Thomas in Bengaluru; Editing by Bernard Orr and Shailesh Kuber)