By Bharath Rajeswaran and Vivek Kumar M
(Reuters) -India’s equity benchmarks rose on Wednesday, led by metals on hopes of improved profitability on China’s plan to reduce its steel output, while expectations of GST cuts helped sentiment.
The NSE Nifty 50 rose 0.55% to 24,715.05 and the BSE Sensex added 0.51% to 80,567.71.
Fifteen of the 16 major sectors advanced on the day. The metal index rose 3.1%, topping the sectoral gains.
“We expect steel prices to pick up in line with global trajectory and strong seasonality as the worst looks behind for the metal sector,” said analysts at CLSA, citing gains for Indian metal companies from China’s “anti-involution” plan to reduce its steel capacity.
The IT index lost 0.7%, and was the sole loser, after data showed contraction in U.S. manufacturing for a sixth straight month in August, signaling weakness in the world’s largest economy. IT companies earn a significant share of their revenue from the U.S.
Auto and consumer shares rose 0.7% each, helped by expectations of consumption-boosting tax cuts at the GST council’s two-day meeting that began on Wednesday.
“While U.S tariffs have triggered export vulnerabilities, GST reforms could create a powerful counterbalance and increase economic activity over the medium term, making the market attractive for investors willing to weather volatility,” said Anil Rego, founder and fund manager at Right Horizons PMS.
The broader small-caps and mid-caps gained about 0.9% and 0.7%, respectively.
Among individual stocks, Lupin gained 3.3% after securing the U.S. drug regulator’s nod for injectable drug Risperidone used to treat schizophrenia and bipolar disorder.
Yes Bank climbed 4.1% after getting competition watchdog’s approval for Sumitomo Mitsui Banking Corporation’s stake purchase in the private lender.
Manganese ore producer MOIL jumped 3.9% after reporting 17% year-on-year growth in production in August.
(Reporting by Vivek Kumar M and Bharath Rajeswaran; Editing by Sumana Nandy, Sonia Cheema and Ronojoy Mazumdar)
