New Delhi, February 12 (Reuters): Indian shares rose on Monday, recovering from their biggest weekly drop since August, as a battered healthcare sector recouped, although State Bank of India slumped after posting a surprise quarterly loss.
Sentiment in India stabilised after Asian share markets on Monday found a semblance of calm as S&P futures extended their bounce, though global investors were still fretting about the risks from looming U.S. inflation data after last week’s sharp sell-off.
Indian shares had fallen nearly 3 percent last week, hit by a global market rout. Worries about a new 10 percent long-term capital gains tax and fears of a central bank rate hike added to the woes.
India is due to post inflation data later in the day, with analysts expecting consumer prices to have risen 5.14 percent last month from a year ago, compared with 5.21 percent in December.
Sentiment is expected to remain wobbly, analysts said, though sectors seen as “undervalued” are likely to attract demand.
“Pharma was one of the oversold and underowned sector,” said Gaurang Shah, head investment strategist, Geojit Financial Services, noting that the earnings outlook for the sector is expected to improve. “Attraction is back into pharma stocks,” he added. The broader NSE index was up 0.56 percent at 10,513.35, as of 0641 GMT. The benchmark BSE index gained 0.63 percent to 34,221.44. Nifty Pharma index climbed 2.5 percent, having dropped 6.3 percent in 2017. Cadila Healthcare Ltd and Piramal Enterprises were among the top percentage gainers, rising over two percent each.
Shares of Oil and Natural Gas Corp Ltd jumped as much as 3.8 pct to 194.5 rupees, after a consortium led by ONGC won a stake in Abu Dhabi National Oil Co’s (ADNOC) 40-year offshore oil concession.
However, shares of top lender State Bank of India fell as much as 3.8 pct to 285.15 rupees, their lowest in nearly a week after the bank posted a surprise quarterly loss on Friday. Indian markets will remain closed on Tuesday on account of a public holiday.