India Stocks Gain as Lower Inflation Kindles Rate Cut Hopes
Bloomberg
Published Jan 15, 2019 04:12
Updated Jan 15, 2019 05:02
India Stocks Gain as Lower Inflation Kindles Rate Cut Hopes
(Bloomberg) -- India stocks rose, joining peers across Asia, as inflation in December eased to an 18-month low, increasing the odds that the central bank may reduce rates helping revive demand and lower the cost of borrowing for companies.
The S&P BSE Sensex advanced 0.8 percent to 36,139.97 at 9:33 a.m. in Mumbai, snapping three sessions of decline. The broader NSE Nifty 50 Index climbed 0.8 percent.
Consumer prices rose 2.19 percent in December from a year earlier, in the third straight month of moderation, the Statistics Ministry said in a statement on Monday. This is the final price print before the central bank’s Monetary Policy Committee meets next month to decide on rates. Earlier, data showed factory output rose 0.5 percent in November, sharply lower than the 8.4 percent gain in the previous month.
The Numbers
- All 19 sub-indexes compiled by BSE Ltd. gained, led by measures of energy companies and software exporters
- Maruti Suzuki India Ltd. and Bajaj Finance Ltd. gave the biggest boosts to the benchmark index
- Yes Bank Ltd. surged as much as 3.6% and was the top performer on the benchmark gauge
Strategist View
- “Lower inflation was expected given the sharp decline in crude oil and food prices,” said Sameer Kalra, president research at Target (NYSE:TGT) Investing in Mumbai. “However, crude remains volatile and may lead the Reserve Bank of India to pause and look at data for another quarter before reducing rates. Though it is likely to keep an easing stance with respect to liquidity.”
- “Earnings for companies so far is showing revenue growth led by volumes even as margins are contracting. The trend is likely to persist for a couple of quarters before the companies regain pricing power and margins improve,” he says.
Get The App
Written By: Bloomberg
Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.