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CORRECTED-India's BSE index hits record high; banks, auto stocks up
June 22, 2017 / 6:42 AM / in a month

CORRECTED-India's BSE index hits record high; banks, auto stocks up

3 Min Read

(Corrects company name in paragraph 8 to IDFC Ltd, from IDFC Bank)

* BSE index up 0.7 pct; NSE index rises 0.6 pct

* Nifty Bank Index hits all-time high

By Jessica Kuruthukulangara

June 22 - India's benchmark BSE index hit a record high on Thursday as steps taken by the capital markets regulator to attract more investments and tackle massive bad loans of banks boosted sentiment.

The Securities and Exchange Board of India (SEBI) proposed on Wednesday to ease some rules for foreign portfolio investors to steer more funds. It also relaxed open offer rules for investors buying distressed companies from banks to tackle mounting debt.

The broader NSE index was up 0.65 percent at 9,696.35 as of 0606 GMT, while the benchmark BSE index was 0.76 percent higher at 31,519.97, after hitting a record high of 31,522.87 earlier.

On Wednesday, minutes from the Reserve Bank of India's monetary policy committee revealed a less hawkish tone as it welcomed data showing inflation easing below target, but wanted more assurance the trend would continue before deciding whether to lower interest rates.

"There's a possibility of a rate cut, not now, but in some time. Rate-sensitive stocks, which include banks and auto, will benefit from the rate cut," said Vinod Nair, head of research at Geojit Financial Services.

Banking stocks boosted both indexes, with the Nifty Bank index gaining as much as 0.8 percent to hit a record high.

Shares of Yes Bank Ltd and Federal Bank Ltd were up more than 2 percent, making them the top gainers on the Nifty Bank Index.

IDFC Ltd rose as much as 3.5 percent, its biggest intraday percentage gain in more than one month, after the RBI allowed foreign investors to resume buying in the company. bit.ly/2sAslkt

Auto stocks also climbed, with the Nifty Auto index up much as 0.9 percent, its biggest intraday percentage gain in nearly two weeks.

Shares of Maruti Suzuki India Ltd and Tata Motors Ltd rose more than 1 percent.

Oil and gas companies fell, with GAIL (India) Ltd, the top loser on the Nifty index, down as much 3 percent, while Oil and Natural Gas Corp Ltd slipped as much as 1.6 percent. (Reporting by Jessica Kuruthukulangara in Bengaluru; Editing by Biju Dwarakanath)

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