Business | Markets
India shares rise more than 5% after rate cut
Indian shares climbed 5.62 per cent on Monday, taking their gains from last week's three-year low to more than a third, with sentiment boosted after the central bank cut interest rates and reserve requirements to shore up growth.
- Reuters
- Published: 00:23 November 4, 2008
Mumbai: Indian shares climbed 5.62 per cent on Monday, taking their gains from last week's three-year low to more than a third, with sentiment boosted after the central bank cut interest rates and reserve requirements to shore up growth.
Leading property firm DLF Ltd, which reported a dip in quarterly profit on Friday, rose 14.9 per cent, Tata Motors, which posted a dip in October sales, rose 11.1 per cent and top bank State Bank of India put on 11.2 per cent.
Infrastructure firms also jumped on hopes that lower interest rates would keep order flows strong and aid project funding.
Leading infrastructure firm Larsen & Toubro rose 10.8 per cent, Reliance Infrastructure jumped 17.2 per cent, and Jaiprakash Associates put on 13.4 per cent.
Analysts said despite four straight sessions of gains, there was still a lot of concern about the market outlook.
"Sustainability is doubtful because there can't be immediate changes in the fundamentals. The liquidity situation is still not happy, and there is still plenty of global uncertainty," said Jigar Shah, senior vice president at Kim Eng Securities.
The 30-share benchmark index rose 549.62 points to 10,337.68, its highest close since October 21, with 28 stocks rising. The index is up more than 34 per cent from a three-year low of 7,697.39 hit last Monday.
In the broader market gainers led losers 1,977 to 639 on volume of 299 million shares.
"We should see a brief correction in the next few days. But till the US presidential election gets over, everybody is on wait-and-watch," an institutional trader at a Mumbai-based brokerage said.
The 50-share NSE index rose 5.48 per cent to 3,043.85.
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