Sensex, Nifty snap three-day fall after S&P raises India outlook to 'stable'
The BSE Sensex and Nifty rose on Friday to snap a three-day losing streak as rate-sensitive stocks such as IDFC Ltd jumped after Standard and Poor's raised India's sovereign credit outlook to 'stable' from 'negative'.business Updated: Sep 26, 2014 17:13 IST
The BSE Sensex and Nifty rose on Friday to snap a three-day losing streak as rate-sensitive stocks such as IDFC Ltd jumped after Standard and Poor's raised India's sovereign credit outlook to "stable" from "negative".
The S&P said the government mandate and improved political setting offered a conducive environment for reforms in Asia's third largest economy. It cited India's external position and improving current account balance among other positive factors.
S&P added it could raise India's rating should the country revert back to a real per capita gross domestic product of 5.5% per year, and if its fiscal, external and inflation metrics improve.|
However, the benchmark indexes marked their first weekly fall in seven due to concerns over the Supreme Court's scrapping of most coal block allocations since 1993, the government delaying a hike in gas prices and foreign investors selling in each of the last three sessions.
"S&P underlines government's efforts in stoking the economy but Modi needs to continue the reform cycle without any lag," said UR Bhat, managing director at Dalton Capital, a unit of UK-based Dalton Strategic Partnership LLP that has nearly $2 billion of assets.
The benchmark BSE Sensex rose 0.6%, or 157.96 points, to end at 26,626.32, while falling 1.7% for the week.
The broader Nifty rose 0.72%, or 57 points, to end at 7,968.85, marking a weekly fall of 1.9%.
Both the indexes marked their biggest weekly declines since Aug.1.
The gains were led by rate-sensitive stocks. The NSE Bank index rose 2%, marking its biggest daily gain since August 18.
IDFC rose 3%, while Axis Bank ended 3.1% higher.
Punjab National Bank rose 2.9%, while State bank of India gained 2.8%.
DLF gained 4.5%, Tata Motors advanced 1.3%.
Hindalco Industries gained 5.4% on value buying after slumping 9.2 percent over the previous four sessions.
Sun Pharmaceutical Industries gained 4.2%, marking its biggest single-day gain since August 20 on speculation of lower chances of an import alert for a unit.
However, among stocks that fell, Petronet LNG declined 3.7% after Asian Development Bank launched a share sale in the gas supplier to raise up to $120 million.