India Stocks Erase Loss as Investors Turn Focus to Gujarat Polls
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India’s benchmark equity index erased all gains to rise for a second day as investors looked beyond disappointing macro numbers to gauge the outcome of Gujarat state elections.
The S&P BSE Sensex climbed 0.5 percent to 33,377.72 as of 1:10 p.m. in Mumbai. Fifteen out of the 19 sectoral sub-indexes compiled by BSE Ltd. gained led by gauge of energy and consumer durable stocks. Kotak Mahindra Bank and Oil & Natural Gas Corp Ltd. were the bests performers on the Sensex.
“Market has discounted the inflation and factory output numbers and is now building up levels ahead of Gujarat exit polls that’ll start rolling out after end of voting on Thursday,” Sanjay Sinha, founder of Mumbai-based Citrus Advisors said. “Its a significant event and victory alone won’t be enough if the ruling BJP doesn’t do it better than the last polls.”
Consumer prices rose 4.9 percent in November from a year earlier as food and fuel costs surged, the Statistics Ministry said in a statement on Tuesday. That’s the fastest pace in 15 months and exceeds all estimates in a Bloomberg survey, pushing the yield on the 10-year sovereign bond to the highest since July 2016 when markets reopened on Wednesday.
Crude oil resumed gains after slipping off the two-and-a-half year high overnight. The U.S. Federal Reserve will announce its interest rate decision later in the day while results for the state polls in Gujarat will be declared on December 18.