Indian shares rise as Bajaj Finance boosts financials, crude oil cools

People walk past the Bombay Stock Exchange (BSE) building in Mumbai, India, November 4, 2020. REUTERS/Francis Mascarenhas

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BENGALURU, July 6 (Reuters) – Indian shares rose on Wednesday, as gains in top non -banking financial company Bajaj Finance after a strong quarterly performance boosted financial stocks, while easing inflation worries on a slump in crude oil prices also supported sentiment.

The NSE Nifty 50 index (.NSEI) rose 0.42% to 15,878.35, while the S&P BSE Sensex (.BSESN) was up 0.52% at 53,413.16, as of 0455 GMT.

Crude oil prices tumbled 9% on Tuesday, hit by worries of demand destruction, which could bring down inflation for India, the world’s third-largest importer.

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“Headline worries still remain the same with regards to a possible recession and high inflation. The markets are positive only on the back of cooling of crude prices,” said Prashanth Tapse, vice-president (research), Mehta Equities.

Market is expecting crude prices to fall below $ 100 per barrel in case of a recession in global economy, which will substantially bring down domestic inflation, he said.

Interest rates and inflation worries have weighed on Nifty and Sensex, with the indexes falling over 8% so far this year.

The Nifty finance index (.NIFTYFIN) rose 0.8%, while Bajaj Finance (BJFN.NS) gained 3.2% after reporting strong June-quarter numbers.

Bajaj Finance was the top mover and boost in the bluechip Nifty 50 index.

Shares of domestic explorers Oil & Natural Gas Corp (ONGC.NS), Oil India (OILI.NS) and Gail India (GAIL.NS) fell between 2.6% and 6.3%.

The explorers have also come under pressure after the Indian government imposed windfall tax on oil producers. read more

Investors are also keeping an eye on the Indian rupee, which hit multiple record lows recently on concerns over the country’s widening current account deficit. read more

Elsewhere, Asian stocks slipped and the dollar stood by a two-decade high against the euro on deepening fears that the continent is leading the world into recession.

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Reporting by Nallur Sethuraman in Bengaluru; Editing by Rashmi Aich

Our Standards: The Thomson Reuters Trust Principles.

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