Indian shares rise ahead of GDP data, but on course for monthly drop

Economists have projected data due at 1200 GMT will show an 8.4% year-on-year growth in the July-September period

  

Indian shares were on course for their first monthly drop in seven even as markets jumped on Friday as investors awaited gross domestic product data that is expected to show the country's economic recovery strengthened in the second quarter.

The blue-chip NSE Nifty 50 index  rose 1.37% to 17,287.75 by 0515 GMT and the benchmark S&P BSE Sensex gained 1.38% to 58,041.36. For the month, both indexes were down more than 2%.

Economists have projected data due at 1200 GMT will show an 8.4% year-on-year growth in the July-September period, according to a Reuters poll last week, the fastest pace among major economies, vs a 7.5% contraction in the same quarter last year.

Tuesday's rally could be attributed to the expectations of positive GDP data as there were no economic disruptions in the quarter and demand picked up, said Gaurav Garg, head of research at CapitalVia Global Research Ltd.

"The market has recovered quite well over the last few days as concerns over the new (coronavirus) variant have been allayed for now," he said.

Another good sign for India is the cooling down of commodity prices, said AK Prabhakar, head of research at IDBI Capital.

All major sub-indexes were trading higher, with the Nifty IT and banking indexes .NIFTYIT .NSEBANK set for their best day in a month.

IT stocks rose as much as 2.25%, with MindTree Ltd being the top performer, climbing 5.03%. Banks rose 1.8%, boosted by RBL Bank and Bandhan Bank  .

Shares of women's apparel maker Go Fashion (India) nearly doubled in their stock market debut after opening at an about 90% premium to their offer price.

Reliance Capital  fell 5% to hit its lower circuit of 18.10 rupees after the central bank said it would initiate bankruptcy proceedings against the company, superseding its board on governance concerns.

(Reporting by Vishwadha Chander in Bengaluru; Editing by Rashmi Aich and Subhranshu Sahu)


More From Equities