Indian stocks rose as they entered their final full week of trading for the quarter, as investors weighed the reopening of the economy against a rising number of novel coronavirus infections in rural areas.
The benchmark Sensex closed 180 points or 0.52% higher at 34,911, while the Nifty advanced 67 points or 0.65% to settle at 10,311. While volatility may be heightened this week ahead of the expiry of futures contracts on Thursday, both measures are set for their biggest quarterly gain since 2009.
“Investors will focus on some heavyweight sectors in the indexes such as financials as the economy reopens and there’s growth in credit,” said Abhimanyu Sofat, head of research at Mumbai-based IIFL Securities Ltd.
Pharmaceutical stocks got a boost after winning regulatory approval for Covid-19 treatments. Glenmark Pharmaceuticals Ltd jumped the most on record after it got approval to sell an oral drug to treat coronavirus, while Cipla Ltd rose as much as 9.4% on news it got a nod to sell its remdesivir treatment.
Coronavirus infections have now spread to 98 of the country’s 112 poorest rural districts, up from 34 on April 15, according to a government report. While India eased its national lockdown on June 8, the nation has so far reported more than 400,000 cases, the fourth-highest tally in the world. The number includes 227,756 recovered cases.
After deadly border clashes with China last week, India said the two nations will join in a summit with Russia today.
The rupee strengthened 0.2% to 76.0250 versus the US dollar, while the yield on the most-traded 6.45% 2029 bond rose 1 basis point to 6.01%.
All but one of 19 industry sub-indexes compiled by BSE Ltd rose, led by a gauge of power companies. Bajaj Auto Ltd was the top gainer on the Sensex, rising 6.7%, while Reliance Industries Ltd was the biggest drag, declining 0.7%.
Meanwhile the Indian rupee rose 16 paise against the US dollar yesterday tracking gains in the domestic equity markets and on sustained foreign fund inflows. The Indian currency closed at 76.03, up 0.21% from its previous close. It opened strong at 76.18 against the US dollar and touched a high of 76.02. It had closed at 76.19 against the greenback in the previous session on Friday. Year to date, the rupee has fallen 6.12%.
Forex dealers said a weak US dollar against major currencies overseas also helped the domestic unit. However, rising crude prices and spike in coronavirus cases restricted gains.
The dollar index, which gauges the greenback’s strength against a basket of six currencies, fell 0.10% to 97.52. Brent crude futures, the global oil benchmark, rose 0.19% to $42.27 per barrel. From the start of the year, Foreign Institutional Investors (FII) were net sellers in the capital market off-loading shares and debt worth $2.35bn and $14.58bn, according to provisional exchange data.
Domestic Institutional Investors (DII) were net buyers of Indian equities with purchases worth Rs87131.20 crore.
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