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Sensex soars 580 points to reclaim 35k-mark as oil drop spurs sentiment

Most stocks in Asia gained Friday, building on a rally in global equities, after reporting the worst returns in October in more than six years.

business Updated: Nov 02, 2018 18:51 IST
Ameya Karve
Ameya Karve
Bloomberg
An employee is reflected in a glass panel as he monitors securities on a computer monitor at a brokerage firm in Mumbai.
An employee is reflected in a glass panel as he monitors securities on a computer monitor at a brokerage firm in Mumbai.(Bloomberg)
         

Indian shares capped their best week since May 2016 as higher sales at the country’s biggest carmaker and a drop in crude oil prices boosted sentiment.

The key S&P BSE Sensex climbed 1.7% to 35,011.65 at the close in Mumbai, extending its weekly advance to 5%. Maruti Suzuki India Ltd., India’s top carmaker, jumped 6.3%, gaining for a second day after reporting an increase in sales in October. Sixteen of the 19 sub-indexes compiled by BSE Ltd. advanced, led by a gauge of automobile stocks.

Most stocks in Asia gained Friday, building on a rally in global equities, after reporting the worst returns in October in more than six years.

The Sensex and the NSE Nifty 50 Index, also up 1.7%, have declined more than 10% since their record close on Aug. 28. Investors were encouraged by a drop in crude oil prices that will help India narrow its trade deficit and spur economic growth. India imports more than 80% of its oil needs.

“Crude moves over the last month has led to a significant correction of India’s stock prices making them attractive,” said Chakri Lokapriya, chief investment officer at TCG Asset Management. The fall in the price of oil is “a huge positive for India’s deficits and inflation.”

Stocks also received a boost this week after India’s government sought to defuse a spat with the central bank over the monetary authority’s independence in handling bank regulation, bad loans and a liquidity squeeze.

There’s more good news. Of the 38 NSE Nifty 50 Index companies that have announced results so far, 20 have either met or exceeded profit estimates.

(Closes prices.)

To contact the reporter on this story: Ameya Karve in Mumbai at akarve@bloomberg.net

To contact the editors responsible for this story: Divya Balji at dbalji1@bloomberg.net, Margo Towie, Naoto Hosoda

For more articles like this, please visit us at bloomberg.com

©2018 Bloomberg L.P.

First Published: Nov 02, 2018 18:51 IST