July 23, 2019 / 5:06 AM / 2 months ago

Indian shares edge up as IT gains on weak rupee

* NSE index up 0.13%, BSE rises 0.18%

* Nifty IT index up 1.2% as rupee weakens

* HDFC Bank extends losses after weak results

By Chris Thomas

July 23 (Reuters) - Indian shares inched higher in volatile trade on Tuesday as a weaker rupee boosted IT stocks, but lacklustre earnings from large cap companies capped gains.

The broader NSE index was up 0.13% at 11,360.45 as of 0433 GMT, while the benchmark BSE index was 0.18% higher at 38,099.16.

Globally, stocks moved higher on expectations that the European Central Bank and Federal Reserve will cut interest rates, but investors in Indian shares kept their eyes on less-than-rosy earnings at home, largely attributed to a slowdown in economic growth.

“The mood is not very positive — outlook remains weak on the back of heavy selling by foreign investors over the last couple of days,” said Siddhartha Khemka, head of retail research at Motilal Oswal Securities.

“The quarterly earnings season has also not been very good, specifically in terms of management commentary. It looks like the next few quarters will be challenging for the entire industry,” said Khemka.

The rupee weakened 0.15% at 69.01 against the dollar by 0427 GMT, which pushed up IT stocks. The Nifty IT index climbed 1.2%.

Infosys Ltd was the top gainer on the indexes, rising as much as 2.5% to a record high, while smaller rival Wipro Ltd climbed 1.8%.

Kotak Mahindra Bank Ltd rose as much as 2.1%, despite missing profit estimates marginally and sounding a cautionary note about the slowing pace of domestic growth.

Meanwhile, HDFC Bank Ltd extended losses into a third session after the lending bellwether warned of slower retail loan growth. The lender had also flagged that the slowdown in the auto sector and stress in the agricultural space were hurting growth.

The bank’s stock, which touched a three-month low, was the biggest drag on the indexes.

Housing Development Finance Corporation Ltd fell as much as 2.2% to a four-week low. The lender is HDFC Bank’s biggest shareholder.

Two-wheeler maker TVS Motor Company Ltd dropped 5% to its lowest since Jan. 2017 after quarterly profit fell about 3%. The stock is set for its seventh straight day of losses. (Reporting by Chris Thomas in Bengaluru; editing by Uttaresh.V)

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